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DAX continues to unwind with key pivot in focus


DAX Xetra (cash index)

Traders are seeing an unwinding move on the DAX that has come in the wake of the sharp gains from the dovish ECB move.

After the huge bull candle of Thursday, there was a decisive retracement move back on Friday which cut almost 100 ticks off the market.

However this is a move that has now unwound back towards what is now becoming a key technical level with a pivot around 12,925.

Taking the moves over the past month as a range broadly between 12,600/13,200 then the pivot around 12,925 is almost in the middle of this range.

Subsequently this becomes a gauge for the near term outlook.

This initial move to the downside is testing the pivot this morning and a close below the pivot would turn the market increasingly corrective again within the six week range.

Momentum indicators are rolling over and momentum from the strong move higher has certainly waned.

  • There is initial resistance with today’s traded high at 12,982 whilst there is also a gap that is now open at 13,010.
  • A close below 12,925 would open a retest of Wednesday’s low 12,780.

 


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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.