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DAX bulls on the brink with old pivot back in focus


DAX Xetra (cash index)

After a period of consolidation and searching for direction, the outlook has been significantly improved from one strong positive candle that has decisively taken the market above resistance at 12,600.

This move has broken a corrective four week downtrend, closing above a batch of overhead supply and is on the brink now of a key breakout.

The old medium term pivot at 12,600 is still seen as a gauge for the market and if the bulls can pull a second successive bull candle with a close above 12,600 this would be a decisive signal.

Momentum indicators are pulling higher, with the MACD lines posting a bull cross, and Stochastics accelerating higher.

If the RSI can pull above 60 it would be a confirmation that the bulls are in control again for the medium term.

  • The previous band of 12,400/12,500 is now a basis of support.
  • A close above 12,600 opens 12,738 with the August high at 12,886 then coming back into focus.

An early look at 12,600 has been rebuffed, but the hourly chart shows positive momentum is building for the bulls now.

 


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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.