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DAX coming under pressure on risk off shift


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

 

After trading for much of yesterday’s session above the 13,000 breakout the market has pulled sharply lower in a risk off driven correction.

  • The developing strong bear candle has breached the reaction low at 12,958 and now a closing breach would confirm a negative shift in sentiment that would put the support band 12,884/12,900 under pressure.

The concerns that have been forming on the MACD lines are now beginning to take hold, with a bear cross on not only the MACD but also the Stochastics.

Furthermore if the market closes today around these levels, there would also be a basic RSI sell signal with a cross back below 70.

Obviously this is still very early in today’s session, but on a broadly basis a close below 13,000 would be taken as negative now.

The hourly chart shows a breach of several higher lows formed in recent days and the momentum indicators turning corrective now.

  • A closing breach of 12,884 would be a key move for continued correction now.
  • The hourly chart shows overhead resistance with Tuesday’s low at 12,958 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.