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DAX consolidation continues as early drop back is supported


DAX Xetra (cash index)

Consolidation that has set in for the past week continues to hold back the market from an upside break.

  • Although there is a near term floor at 10,786 there is a mini-range formation that has seen the bulls struggling every time the pivot around 11,000 looms.

The last two sessions have contained higher closes but interestingly with negative candlestick patterns.

This reflects the lack of conviction currently in the market.

Momentum indicators have tailed off in their recoveries but are just into a reflection of the near term consolidation.

The early move lower today has failed to ignite the bears and the market looks to be fairly stable.

Looking on the hourly chart there is an increasingly neutral configuration, with the hourly RSI oscillating between 40/65 now, and the MACD lines hovering around neutral.

  • The early gap lower from last night’s close pf 10,931 is likely to be filled in due course as this consolidation looks set to continue.
  • Today’s low at 10,822 is initially supportive above 10,786.
  • Resistance at 10,945 protects 11,000.

 


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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.