Levels to watch: FTSE 100, DAX and S&P 500
Indices continue to make gains, with intraday weakness usually seeing buyers emerge, even after the sharp gains of the past month.
FTSE 100 still on a tear
The relentless climb goes on here, with the FTSE 100 touching a new three-month high for a short time yesterday.
Crucially, it is now in the zone that marked the limit of gains in October and November. The straight-line move of the past week has yet to see any real weakness, and pullbacks towards previous resistance around 7020 may find support.
DAX reclaims 11,300
The DAX succeeded in breaking out of its recent consolidation yesterday, moving back above 11,300 and pushing above the 100-day simple moving average (SMA) of 11,321.
The next target is the downtrend line from the June highs, which would suggest resistance around 11,500. A drop back below 11,200 would be a bearish development, but even here the index still then encounters support around 11,100.
S&P 500 aiming to challenge 200-day MA
The S&P 500 continues its ascent, although it is still below the 200-day SMA (2743).
It is arguably within a rising wedge formation, with a narrowing trading range as it approaches the apex. This is usually a bearish formation, but the steady rally over the past month should act as an indication of how strong momentum currently is. Above the 200-day SMA the 2810 zone comes into play, the highs from October and November.
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