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Bull control is beginning to slip


DAX futures (Dec 2017 contract is FDXZ7, continuation contract is FDXc1)

 

The market continues to post a series of higher daily lows, but that does not mean the bulls are in control.

Yet another failed break above 13,000 was seen yesterday and now we are beginning to see the medium term positive technical picture beginning to be deconstructed.

Support from the seven week uptrend is now being broken, whilst the MACD lines are crossing lower.

Momentum in the bull trend is waning now and serious questions are beginning to be asked of how sustainable any move above 13,000 will be.

  • Friday’s high of 13,031 could not be breached yesterday as the market closed back below 13,000 again, whilst early this morning we see 13,000 acting as resistance.
  • A move below yesterday’s low at 12,970 would add to concerns of a rolling over.

The key support remains the recent mini-range low at 12,884 but if the RSI and Stochastics also begin to deteriorate as the MACD lines are doing then the profit takers may begin to move in.

The hourly chart is not yet suggesting selling pressure is building, but watch for the hourly RSI moving below 40 and the hourly MACD lines dropping consistently below neutral.

  • Below 12,970 support is at 12,934 and 12,915.
  • Resistance is 13,000 and then the two successive day highs at 13,020 and 13,031.

 


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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.