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DAX back down again as rallies remain a chance to sell


DAX Xetra (cash index)

The market has become increasingly choppy in recent sessions as newsflow has driven daily moves both higher and lower, however technically the outlook remains corrective.

Although the sharp two week downtrend has been broken (it was never likely to last for too long at that pace of decline) however the negative candles continue to some through and the potential of a sustained rally is still some way off.

Even though the market closed 130 ticks higher, Friday’s rebound candle closed marginally below the open to leave the bulls a bit in limbo, whilst the opening gap lower today reclaims the outlook for the bears.

  • There is a gap to be filled at 12,260 still, but there is a configuration for selling into strength still.

Daily momentum indicators remain correctively positioned and have slipped back again on a near term basis, as the RSI is stuck below 40, MACD lines falling and Stochastics ticked back lower.

  • The hourly chart shows resistance at 12,440 has been bolstered as Friday’s rebound failed at 12,383.
  • Although Thursday’s low so far remains intact at 12,104 look to use any unwinding strength as a chance to sell
  • The hourly momentum is negatively configured and expect further pressure on 12,104 and a move back to test the medium term implied target at 12,000 in due couse.

 


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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.