DAX Xetra (cash index)
The DAX continues to pull higher as the bulls now prepare to negotiate a key crossroads that could determine the medium term outlook.
Having rallied through 12,440 last week the medium term pivot at 12600 has been looming large and is ever closer as the market continues to edge higher.
However it is interesting to see the past couple of sessions closing at or marginally lower than the open, this suggests that the bulls are reactive (to US session closes), rather than proactive.
Early gains again today have not pushed on (threatening to be the third successive day this has happened).
Is this a reflection of the caution that comes with the importance of the overhead pivot?
Momentum indicators are still improving for now, with the Stochastics still rising and MACD lines only just having crossed higher, but the RSI has simply just unwound back to 50 which if it begins to stutter could give rise to a medium term selling opportunity.
A near term uptrend is intact on both daily and hourly charts, whilst on the nearer term perspective, the 21 hour moving average (currently at 12,494) is a basis of support.
Hourly momentum is also positively configured.
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