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DAX consolidates as the bulls take a pause for breath


DAX Xetra (cash index)

The run higher has hit the skids a bit today as the DAX opened higher only to have the reins pulled again.

For now this is only a pause within what still looks to be a run to test the 11,824 resistance, however, given that resistance of the last two sessions (admittedly today’s is still very early) is at 11,706 and a shade under the 11,725/11,865 long term pivot, this needs to be taken with caution.

It will be interesting to see how the bulls respond to not only the long term pivot band but also the fact that there is a gap still open at 11,549 which still is likely to be filled.

There is a more positive configuration to momentum now which is swinging higher with the Stochastics accelerating higher, RSI up to 60 and the MACD lines close to a bull cross.

  • Corrections should be seen as a chance to buy and pressure on the overhead resistance at 11,824 should continue.
  • Initial support shown on the hourly chart is building with yesterday’s lows at 11,612/11,630 which comes around an old pivot at 11,625 form trading throughout March.
  • A close back above 11,706 helps to open the recent high and pressure the pivot resistance 11,725/11,865.
  • A breakout above 11,865 opens the September highs around 11,450 but also forms a big base pattern.

 


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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.