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DAX rebound now approaching a key crossroads


DAX Xetra (cash index)

The DAX continues to put pressure on the resistance band 12,400/12,500 as the rally from the 12,120 August low moves into its fifth day.

Although the rally has not been a straight line move, the past couple of sessions have been decisive bull candles.

  • However, the rebound is now into a key phase in this 100 tick band between 12,400/12,500 with the resistance of a three week downtrend around 12,500 today.

This comes with the momentum indicators ticking higher on a near term basis, but essentially unwinding a medium term corrective outlook.

The question is whether this near term rally can become something more substantial, and for that the DAX needs to rally through 12,500 in the least.

Although this would still be (marginally) below the moving averages but it would be breaking through overhead supply.

Ticking higher again after a lower open suggests that the bulls are still interested in pushing on, but the hourly chart shows resistance is being met and the hourly momentum indicators are threatening to roll over.

  • Today’s low at 12,353 is initial support, but a breach of the minor low at 12,315 would signal the bull move failing.

 


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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.