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DAX gaining but still needs to make the breakout


DAX futures (Dec 2017 contract is FDXZ7, continuation contract is FDXc1)

Sharp gains on Wall Street as tax reform looks to be progressing have been translated through to gains on the DAX.

The positive candle posted yesterday has been followed this morning by a big opening gap higher.

This move has taken the index back within touching distance of a test of the recent rebound high at 13,209.

A close above this resistance would put the bulls back in control once more following the sharp corrective move throughout November back from 13,533 to 12,842.

Momentum indicators are looking to improve once more in the wake of the gains of over 160 ticks in the past day or so.

This comes with the Stochastics accelerating higher and the RSI back above 50.

However, as yet nothing is still confirmed and this is still playing out as part of a very choppy phase for the market over the past two weeks.

  • The initial gains have not yet breached 13,209, with a high at 13,195 this morning before unwinding a touch.
  • Until the market closes above 13,209 or below 12,842 then the choppy consolidation continues.

The hourly chart shows the RSI is around 70 again which is around where previous rallies within the range have floundered in the past two weeks.

  • There is a 30 tick band of interim support now 13,090/13,120 which needs to be watched as continued trading above here will help to build positive momentum for an upside break that as yet remains illusive.
  • Above 13,209 opens 13,310/13,335 as the next resistance.

 


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