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Breakout on the DAX opens the long term pivot band


DAX Xetra (cash index)

The DAX has finally joined other major markets in breaking to new multi-month highs again to open the way for further recovery.

This comes as the market has closed above the resistance at 11,371 which completed a range breakout and imply around 410 ticks of additional recovery.

It now means that a retracement into the long term pivot band 11,725/11,865 is now a realistic possibility.

There is a strength to the momentum indicators with the RSI rising into the low 60s, MACD lines tracking higher and Stochastics into strong bull configuration.

A test of the long term downtrend of the past 8 months (currently at 11,545) is now due.

  • Weakness is a chance to buy, with the old resistance of the breakout at 11,371 now being supportive.

The hourly chart shows positive configuration on momentum with 40/50 on the hourly RSI being a basis of support and MACD lines consistently above neutral.

  • There is a band of support 11,260/11,325 now.
  • Initial resistance is at today’s traded high of 11,448 with the December high of 11,567 subsequent to that.

 


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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.