DAX Xetra (cash index)
After over a week of consolidation and drift, the bulls returned in force yesterday to drive the DAX for a breakout to a new two month high.
This continues the recovery from the December low at 10,279 which has added over 10% to the market, a rally that has pulled higher and now seen the bulls buy into three periods of consolidation that have all lasted around a week.
A strong bull candle breakout seems to accompany all of the breakouts and weakness is now a chance to buy.
The move higher is backed up by strength in the momentum indicators, where the RSI is into the 60s, the MACD lines are rising and Stochastics rising into strong configuration again.
An early slip back today is likely to be seen as another opportunity for the bulls.
The next real resistance is the December high of 11,567 whilst the path of recovery back towards a near eight month downtrend (currently comes in around 11,650) continues.
The hourly chart shows positive configuration on momentum with RSI consistently finding a bottom between 35/45 and strong hourly MACD.
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.