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FTSE pulls back from historical range top, DAX expected to break higher from consolidation

The FTSE rally hit the buffers yesterday as the index reached the crucial 6237 level (March peak) which previously market the top of a month long range. This does not mean we will be back trading in this range once more, yet it does mean that we will need a breakout above this level to set us on our way towards further gains. For now, we have got a clear short term trendline support in play. This should hold given the bullish price action leading into the current formation. However, an hourly close below 6142 would provide a more bearish view. Until that happens, a bullish outlook is in play, with 6200 and 6237 the next levels of resistance to watch out for.

DAX expected to break higher from consolidation

The DAX has been consolidating over the past 24 hours, following on from a sharp rally in the early hours of yesterday. This current range looks like a continuation pattern, which would be expected to resolve with a break higher given the trend coming into this pattern. As such, a bullish view is in play, with any move down towards the lower end of the range of particular interest for longs. An hourly close below 9900 would point towards a deeper retracement, with 9838 the next near term support level. However, should we indeed see the break higher, then 10038 and crucially 10121 would be the main levels to be watching out for to the upside.

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