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DAX breakout opens the all-time highs again

DAX futures (Mar 2018 contract FDXH8, continuation contract is FDXc1)

Breakout! Finally…

After four frustrating weeks of failed rallies, the DAX has finally made the break above resistance at 13,238 and the move has opened the all-time high of 13,525.

The closing breakout with yesterday’s extremely strong bullish candle that closed decisively above 13,238 which on a range breakout implies around 430 ticks of upside now towards 13,665.

The move has clearly come as a run in front of confirmation of tax reform in the US, and as long as the bill goes through, the bulls will remain in control near term.

Momentum indicators confirm the breakout, with the RSI at a six week high, MACD lines tracking higher and Stochastics in bullish configuration.

  • Minor corrections will also now be seen as a chance to buy, with the breakout at 13,238 now the beginning of a basis of support above 13,200.
  • The hourly chart shows a mild consolidation early today as the momentum has become stretched, but unless tax reform fails, any drift unwind is likely to be seen as another chance to buy.
  • There is minor resistance around 13,400 with 13,525 now clearly key.


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Research Risk Warning

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.