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DAX 40 in a Bear Market, FTSE 100 Dragged Down to Key Support

DAX 40 in a Bear Market, FTSE 100 Dragged Down to Key Support

DAX 40, FTSE 100 Analysis and News

  • DAX 40 | Bear Market Hit, Risks Remain Lower
  • FTSE 100 | Dragged Down to Key Support

DAX 40 | Bear Market Hit, Risks Remain Lower

Geopolitics remains at the forefront of investor focus and thus dictating much of the price action. The main highlight overnight had been the spike higher in oil prices in which Brent crude futures rose to $139/bbl amid reports that US are considering whether to ban the import of Russian oil. A reminder that, the US import roughly 3% of crude oil from Russia, which was equivalent to 209kbpd of crude during 2021. In turn, with the surge in oil prices showing very little signs of easing, Russian contagion risks are spreading, raising concerns of a global economic slowdown. That said, equities remain a sell on rallies, in which European futures face the bulk of the selling, given Europe’s proximity to the conflict.

As European indices post their largest weekly outflows on record, the DAX has fallen into bear market territory having posted a 20% decline from its November peak. As risks remain firmly titled to the downside, eyes will be on a test of the 50% Fibonacci retracement at 12,280-300. Meanwhile, topside resistance resides at the 200WMA (13,104).

DAX Chart: Weekly Time Frame

Source: Refinitiv

Germany 40 Bearish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 40% -14% -1%
Weekly 19% -18% -9%
What does it mean for price action?
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FTSE 100 | Dragged Down to Key Support

While the FTSE 100 has been a relative outperformer, the index has not been immune to the recent bout of risk aversion. Although, the index is now back down to a key support area from 6800 having made a convincing break below its 200DMA. A close below 6800 however, places the index on course for a move towards 6500-6600. Resistance is situated at 7000 and 7200-20 above.

FTSE 100 Chart: Daily Time Frame

Source: Refinitiv

FTSE 100 Bearish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily 44% -14% 2%
Weekly 35% -17% -3%
What does it mean for price action?
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