FTSE 100, DAX 40 and Nasdaq 100 Begin Week on Cautious Footing

FTSE 100, DAX 40, Nasdaq 100 - Analysis and Charts

On Friday the FTSE 100 briefly revisited its February 2023 record high, made close to the 8,050 mark, before giving back its intraday gains. It nonetheless remained above its March-to-April uptrend line at 7,911 which continues to underpin. While this is the case, the psychological 8,000 mark will remain in sight, together with the 8,017 early April peak.

Below the uptrend line support can be spotted at last week‘s 7,886 low and also at the previous week’s 7,856 low.

The DAX 40 slid to a one-month low on Friday, voiding Thursday‘s bullish hammer formation on the daily candlestick chart, on fears that the situation in the Middle East could escalate. Saturday’s attack on Israel by Iran has proved these fears to be justified but hope that the former will show restraint has led to a minor recovery in the index on Monday morning.

While last week‘s low at 17,831 holds, there remains a possibility for the DAX 40 index to regain some of the last couple of weeks’ 4% losses. A rise above Fridays 18,165 high would technically confirm the resumption of the medium-term uptrend. Failure at 17,831 would put the early March low at 17,619 on the cards.

The Nasdaq 100s sharp fall to 17,950 on Friday following a swift advance to 18,337 on Thursday means that US earnings season at a time of escalating tensions in the Middle East provides lots of volatility with Q1 earnings by the likes of Goldman Sachs, Bank of America and Netflix likely to keep volatility elevated for this week.

While the current April lows at 17,866 to 17,862 underpin, further sideways trading with an upside bias remains at hand with last weeks high at 18,337 representing a possible upside target.