Article by IG Senior Market Analyst Axel Rudolph
FTSE 100, DAX 40, S&P 500 Analysis and Charts
FTSE 100 slips on risk-off sentiment
The FTSE 100 looks to be on track for a third consecutive day of losses as a rising oil price due to extended voluntary supply cuts by Russia and Saudi Arabia and rising yields put pressure on sentiment and stock markets. The breached July-to-September downtrend line, now because of inverse polarity a support line, at 7,390 is about to be tested, together with Tuesday’s low at 7,388. If it falls through, the 7,300 region could soon be back in play.
Resistance remains to be seen along the 55-day simple moving average (SMA) at 7,475 and also at Monday’s 7,524 high.
FTSE 100 Daily Chart
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| Change in | Longs | Shorts | OI |
| Daily | -4% | -3% | -4% |
| Weekly | 7% | -10% | -5% |
DAX 40 continues to slide
The DAX 40 continues to slide, this time due to weak Eurozone PMI data and as German factory orders tumble. They dropped by 11.7% month-on-month (MoM) in July, worse than an expected plunge of 4.0% and the first drop in industrial orders since March and the steepest pace since April 2020. Were Tuesday’s low at 15,690 to be slipped through on a daily chart closing basis, the August lows at 15,545 to 15,469 may be revisited in September.
A potential bounce may encounter minor resistance around Monday’s low at 15,796 ahead of the 24 August high at 15,895. While the next higher 55-day simple moving average (SMA) at 15,934and the July-to-September downtrend line at 15,958 cap, overall downside pressure should retain the upper hand.
DAX 40 Daily Chart
S&P 500 is keeling over
The S&P 500 is beginning to lose upside momentum and is gradually sliding from last week’s 4,540 high to its 4,474 24 August high and the 55-day simple moving average (SMA) at 4,470 as the oil price and yields are rising. Traders are looking forward to today’s US ISM services PMI data to gauge the state of the US economy.
Minor resistance is seen around the 4,500 mark ahead of the current September peak at 4,540.
S&P 500 Daily Chart
