S&P 500 trading at 7-week highs while FTSE 100 and DAX 40 struggle to keep up
Outlook on the FTSE 100, DAX 40 and S&P 500 as US equity indices lead the way higher.
FTSE 100 still attempting to break through key resistance
The FTSE 100 is struggling to break through its key 7,349 to 7,374 resistance area on a daily chart closing basis on easing Federal Reserve hike bets as it moots the idea of reducing the pace of future tightening.
The resistance area consists of the late June and 20 July high as well as the 200-day simple moving average (SMA).
Thursday’s rise and daily close above 7,374 confirmed a double bottom with an upside target coming in around this year’s highs at 7,621 to 7,688. For this bullish signal to be strengthened, ideally an advance above Thursday’s high at 7,411 should ensue as well.
Immediate minor support below last week’s high at 7,349 sits at Thursday’s low at 7,309. The index remains technically short-term bullish while it stays above this level on a daily chart closing basis.
DAX tries to overcome key resistance at 13,444 to 13,458
The DAX 40 has revisited its 13,444 to 13,458 June 21 and current July highs, having recovered from Tuesday’s 13,030 low.
France’s better than expected second quarter (Q2) gross domestic product (GDP) growth of 0.5%, versus estimates of 0.2%, added to the positive short-term sentiment which permeates equity markets at present.
While 13,030 underpins, another attempt at overcoming the 13,444 to 13,458 resistance area may unfold, an advance above which would engage the mid-June high at 13,676 and also the mid-May low at 13,685.
If exceeded, a medium-term bullish reversal could lead to a several week-long rally taking the DAX 40 back towards its March-to-June highs at 14,712 to 14,927.
Support below Tuesday’s low at 13,030 can be found at the 8 July high at 13,021 and also at the 19 July low at 12,823.
S&P 500 rallies to 7-week highs
The S&P 500 is trading at seven-week highs and is accelerating to the upside, helped by positive US earnings and Federal Resever chair, Jerome Powell’s comments that slowing the pace of rate hikes whilst keeping a close eye on inflation and the economy might be appropriate.
Over the past couple of days, the index has risen by over 3.5% and is fast approaching its May and June highs at 4,189 to 4,203 which represent important resistance.
Minor support can be spotted at the 22 July high at 4,012.
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