DAX Xetra (cash index)
Equity markets have fluctuated in the past few sessions but it is interesting to see that given the sharp deterioration in risk appetite, there has not been an overly significant sell-off.
Yesterday’s negative candle saw the DAX close strongly lower, but not breach the 10,387 support of the higher low above 10,279.
An open higher today is once more pulling the prospect of a near term upside test of resistance.
Can the market build for a move through this near term ceiling?
Encouragement comes with the three week downtrend recently breached and there is an interesting basis of support forming.
However, there is an ongoing negative medium term configuration with the RSI struggling under 41 over recent weeks, whilst the MACD lines are tracking lower.
The hourly chart shows an ongoing trend lower , whilst the hourly RSI is restricted around 60 and MACD lines failing around neutral.
These hourly indicators need to improve in order for a near term rally to be sustainable.
In the absence of this, rallies will continue to struggle and the outlook remain negative for a retest of support and below.
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