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DAX dropping back but will it remain a buy into weakness?


DAX Xetra (cash index)

The DAX has pulled back in the past couple of sessions as the momentum in the recovery has ebbed away.

However all is not yet lost for the bulls.

They may have slipped but the uptrend channel formation of the past few weeks remains intact and the bulls will be eying a continued closing level above the 23.6% Fibonacci retracement at 12,379.

The key higher reaction low on an intraday basis is also intact (last week’s low at 12,284).

However, the bulls also need to return quickly as the momentum in the recovery is waning as the RSI is tailing off under 50 and the Stochastics are also losing their impetus.

The hourly chart shows a positive configuration remains in the recovery with the hourly RSI holding up above 40 and MACD lines above neutral.

Corrective moves continue to be a chance to sell whilst these trends are intact.

  • Initial support is a tan old pivot at 12,340.
  • A late rebound high at 12,544 adds resistance below 12,601 key near term resistance 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.