FTSE, DAX Price Forecast: Rate Hikes Take Center Stage as Equities Suffer

[MongiIG]

Jun 10, 2022 | DailyFX
Richard Snow, Analyst

DAX, FSTE 100 NEWS AND ANALYSIS

• FTSE set to mark second successive weekly decline.
• Rate hikes take center stage: ECB (yesterday) and BoE next week.
• DAX technical levels assessed as price action erases prior breakout gains.

FTSE 100 Technical Analysis

The FTSE 100 signaled a top when price action attempted, but failed numerous times, to close above 7615 – leaving a series of extended upper wicks to show for it. Since then, the index has dropped below 7565 and the crucial 7400 level (prior swing high) to end the week.

Support lies at 7357 followed by 7283 and 7220 before the long-term ascending trendline from March 2020 comes into play. Nearest resistance, naturally comes in at 7400 with 7565 appearing an awfully long distance away. The MACD reveals a bearish crossover which tends to support a bearish outlook. However, something to note is that the FTSE has put in some impressive recoveries after sizeable two-day declines in the past.

Daily FTSE 100 Chart

Source: TradingView, prepared by Richard Snow

 

DAX Technical Analysis

The outlook for the DAX looked fairly bullish after the triangle breakout which has just about surrendered all of those prior gains. 13,910 stands in the way of continued bearish momentum and may influence where we end the week. Resistance comes in at 14,270 followed by 14,600.

The MACD also highlights a bearish crossover which suggests further downside for the DAX but as mentioned earlier, the weekly close should be monitored for developments around the 13910 level.

Daily DAX Continuous Futures Chart

Source: TradingView, prepared by Richard Snow