FTSE 100, DAX and Dow reverse higher after sell-off
FTSE 100, DAX and Dow start to reverse higher once more following yesterday's declines.
FTSE 100 attempts to continue recovery after recent slump
The FTSE 100 has been regaining ground since last week's sharp decline into the 76.4% Fibonacci support at 5690. Despite that sell-off, the uptrend remains intact for now, yet questions remain over whether the tide is slowly changing after significant gains since the mid-March low.
Given the wider uptrend, the primary path for today is bullish, yet the gradual ascent seen this morning stands in stark contrast to the sharp decline at the turn of the month. With that in mind, this rally may start to falter given the somewhat unconvincing nature of it. A break below the 5788 swing low would bring a more bearish outlook, with a bullish short-term outlook in play until then.
DAX heads back towards resistance zone
Yesterday’s DAX rally fell short at the 10,773-10,825 resistance zone, yet we are heading higher once again this morning as the index attempts to regain lost ground. The ascending trendline in play over the past month serves to cap downside for now, with continued ascending lows remaining a backbone of this recent gradual uptrend.
We certainly appear to have entered a very different phase since mid-April, with the index upside proving significantly less convincing. Nonetheless, this uptrend remains in play until we break support, with the ongoing outlook determined by the whether we see the 10,773-10,825 resistance zone broken or not.
Dow Jones regaining ground from higher low
The Dow Jones has also seen higher lows in place over recent weeks, with yesterday's declines appearing to provide another example after hitting the 76.4% Fibonacci retracement level.
With that in mind, there is a good chance of a rally up through the 24,171 level to continue the gradual ascent that has been in play over the past month. To the downside, we would need the overnight low of 23,524 broken to start building a more bearish theme.
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