Levels to watch: FTSE 100, DAX and Dow
The DAX and Dow are showing signs of a potential bullish phase coming into play. Meanwhile, the FTSE 100 remains stuck in consolidation mode ahead amid the heightened Brexit uncertainty.
FTSE 100 continues to consolidate
It has been a difficult week to trade the FTSE 100, with Brexit volatility failing to provide a clear direction for UK stocks.
The 76.4% retracement around 7180 still remains a key area which has to be broken to point towards a possible move towards 7212. Alternately, a break below 7124 would provide a bearish breakdown signal. Until then, further consolidation looks likely.
DAX reversing from trendline resistance
The DAX has seen its gains limited, with trendline resistance helping send the market back into the 200-hour simple moving average (SMA).
A break below that moving average would provide an important sell signal. However, with the index providing lower highs and higher lows, the directional bias for this market is not clear right now. Thus, a break below 11,473 or above 11,622 would provide the bias from here on in.
Dow approaching key bullish breakout level
The Dow Jones has been regaining ground, with the price seemingly finding it tough to break through the 25,765 peak from Tuesday.
This area of resistance the Tuesday and Wednesday peaks (25,765-25,779) provides us with a key bullish breakout zone if broken. The longer-term charts do highlight the possibility of a wider retracement of the 26,241. However, for the near term, the ability to break through that resistance zone is going to be key for sentiment.
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