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A sharp turn lower sees DAX bears on the brink

DAX Xetra (cash index)

After an extraordinary session yesterday the outlook for the medium term improvement on the DAX is now under pressure.

Having looked set initially to push for a breakout above 12,600 early in yesterday’s session, an intraday sell-off posted a negative candle and now with early weakness again today the bears are beginning to gather momentum.

An initial break of the breakout support at 12,460 has been seen today and if this is confirmed by a move below the reaction low at 12,375 then the bears will begin to find some traction in a resumption of the correction.

Momentum indicators are reflecting this increasing deterioration, with the Stochastics having crossed lower, the RSI rolling over around 60 and the MACD lines also looking as though they have lost their momentum.

The hourly chart shows the market is on the brink, with the MACD lines threatening to turn negative, however the sellers are close to gaining control.

This is reflected in the hourly RSI which is beginning to breach 40.

  • A decisive move below 12,466 is a consistent one week low, and pressure mounts with a close below 12,460.
  • Below 12,375 would be a break below all the hourly moving averages too.
  • Resistance at 12,600/12,647 is growing, with initial resistance of yesterday’s close at 12,550.


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At Hantec Markets Ltd we provide an execution only service. Any opinions expressed by analyst Richard Perry should not be construed as investment advice or an investment recommendation. This report does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. Forex and CFDs are leveraged products which can result in losses greater than your initial deposit. Therefore you should only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved, seeking independent advice if necessary prior to entering into such transactions.