DAX futures (JUNE 2017 contract is FDXM7, continuation contract is FDXc1)
Despite yesterday’s rally the corrective near term outlook on the DAX continues.
The near term top pattern below 12,234 remains intact and this implies a downside target of around 175 ticks to 12,060.
The rebound move seen yesterday may have formed a strong bull candle but the rolling over of the rally with equities lower again today suggests this was simply counter to the recent trend.
This is reflected in the continued decline on the daily RSI and Stochastics whilst the MACD lines are also crossing lower.
This remains a near term corrective move that could be set t put pressure back on the old breakout support at 12,130 which held up yesterday.
The hourly chart shows a downtrend has formed this week and hourly momentum is in negative configuration whilst rallies on the hourly RSI into 50/55 is a chance to sell.
Hourly MACD and Stochastics crossing back lower is also near term negative.
- Support is at yesterday’s low at 12,142 with 12,130 a bigger support, below which is 12,175.
- There is an opening gap lower at 12,245 and the market will remain corrective below yesterday’s reaction high at 12,270.