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DAX drops ahead of payrolls with key pivot holding


DAX Xetra (cash index)

A downtrend channel of the past two months is being tested following a hugely strong day for the bulls yesterday.

Can this move be sustained as the early moves have again seen the market drop back again following Trump’s move to escalate further trade tensions with China.

There is clearly a technical improvement in process with momentum indicators tracking higher with the RSI highest since late January, MACD lines and Stochastics rising.

Key to this improvement could now be a reaction to a pivot around 12,160.

If the market can hold on to the upside of this pivot then the pressure will grow on the upper limit of the downtrend channel.

  • Yesterday’s high at 12,322 is resistance moving into Non-farm Payrolls today and technically this more positive outlook is backed by the more positive configuration on the hourly chart which suggests corrections are a chance to buy.
  • A move back below yesterday’s traded low at 12,135 would be a disappointing move now for the bulls and suggest the improvement has faded.

Payrolls could be a key volatility factor to watch today.

 


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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.