DAX futures (Mar 2018 contract FDXH8, continuation contract is FDXc1)
After the selling pressure of recent weeks, the market seems to be finally looking to settle down again.
The huge volatility has subsided to an extent and violent intraday swings have not materialised yet this week.
This comes with the Average True Range of 292 ticks whilst yesterday’s daily range was just 122 ticks.
Momentum indicators have settled but are yet to suggest the buyers are ready to sustainably return.
There is initial resistance from Monday’s rebound high at 12,373 which needs to be overcome and this is a key barrier for a recovery now.
Above 12,373 would mean higher lows and higher highs starting to form.
The hourly chart shows old support around 12,400 also needs to be overcome, whilst the hourly RSI is still struggling to make it back above 60.
If the hurdle of US CPI can be overcome without any significant increase in volatility again then traders could begin to seriously contemplate a recovery.
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