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DAX pondering a breakout but technicals remain strong

DAX Xetra (cash index)

The market continues to stand on the brink of a key technical move but the DAX bulls just cannot shake off the resistance that is preventing a decisive breakout above 12,600.

Yesterday’s session saw the market fluctuating higher and lower around the key February high of 12,600 but eventually closed a frustrating session with no overall control.

This indecisive phase of trading seems to have continued into the early moves of today’s session.

However the near to medium term recovery remains on track with the two week uptrend underpinning the recovery, whilst momentum indicators remain positively configured.

The run of higher lows also continues to build above the six week pivot at 12,160 with support at 12,256 and 12,375 so the bulls  will be looking for the next higher low in the formation of the uptrend.

On the hourly chart there is positive momentum configuration with the RSI consistently forming lows 40/45 and this slip back from 12,640 seems to be simply an unwinding move.

  • The rising 55 hour moving average is also a basis of support at 12,450 now.
  • A near term buy zone is therefore between 12,450/12,525.
  • A close above 12,600 suggests the bulls are finding traction, with opening  12,745 and 13,000 next resistance levels.

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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.