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DAX crashes through key support, FTSE hits crucial Fibonacci support

The FTSE has seen yet another sharp leg lower this morning, in a continuation of the weakness we have seen dominate the second half of the week. However, looking at the four hour chart, this recent move looks like a retracement rather than a reversal. With that in mind, it is very telling that this morning’s selloff has respected the 76.4% pullback perfectly. We could see this level taken out, yet this is an interesting area of a potential move higher. As such, given the uptrend in play, a bullish view is back in play from the 76.4% retracement (6190) for a move back to the highs of 6323. This would be negated with an hourly close below 6149.

DAX crashes through key support

The DAX has seen another sharp leg lower this morning, entirely negating the rally that occurred earlier in the week. Certainly this break below 10037 is a very bearish sign and further downside appears likely in the short term. However, this pullback could also be seen as a retracement of the sharp rally in late May. With that in mind, watch out for potential support at the 76.4% retracement (9885) should we reach it. However, until we see a sign of a reversal, it is likely people will be selling into rallies.

Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.