In today’s indices outlook, we take a look at the technical setup for Stoxx 600, Stoxx 50 and the FTSE 100, with Geoff Wilkinson, Associate at Linear Investments.
Stoxx 600: Important to stay within the trend channel
Wilkinson takes a look at the technical charts for the Euro Stoxx 600, noting the key levels on the index. A minor resistance could be seen at 393.60 and then the major downtrend around 395. A double support area could be found around 379. Draghi’s speech on Thursday remains a key risk.
Stoxx 50: Clear close above 3530 to be bullish
Wilkinson mentions that the Stoxx 50 remains a good indicator to determine where European equities are headed. On the technical outlook, he says that index is near a major uptrend resistance. He believes that the next catalyst higher for the index would likely be a break above 3530. The support could be found at 3460.
He further notes that the price action has been constructive on the index since October, and dips below the trendline have been bought.
FTSE 100: 6450 key for direction
Looking at technical charts for the FTSE 100, Wilkinson notes that the UK equity market index broke through a major downtrend, and remains currently supported around the 6330 level. The index is seen stalling around the 6400 level, which is more of a psychological level.
He highlights 6450 as being a key fib level, and believes that Draghi will have to say something exceptionally positive to push the market higher heavily.
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