The FTSE 100 is currently trading near its 200-day simple moving average at 8,224, supported by a UK December inflation report that was slightly softer than expected.

Key support levels are identified at the 55-day SMA of 8,200, the January 7 low of 8,186, and Tuesday's low of 8,181. If these support levels are breached, it is possible that the index could test the psychological 8,000 mark.

On the other hand, resistance is noted at 8,267, and if surpassed, there is potential for a rise to 8,327.

In Germany, the DAX 40 has seen a slight increase in anticipation of the release of US inflation data. If the DAX 40 rises above Tuesday's high of 20,364, it could reach the January high of 20,485. Conversely, if it drops below Tuesday's low of 20,203, it may revisit the 20,000 level.

Meanwhile, the Nasdaq 100 is currently testing a critical support zone between 20,769 and 20,533, which includes the December and current January lows. If the index closes below this range, it could trigger a decline towards the mid-November low of 20,306. The index is under immediate downside pressure while trading below the 55-day SMA at 21,061 and Friday's high of 21,200, indicating cautious sentiment ahead of the upcoming US inflation data.