DAX Xetra (cash index)
The key near to medium term technical support around 12,600 has held on the DAX and the bulls are now looking to build a recovery once more within the 600 tick range.
During yesterday’s sharp decline, the key factor was whether the support of the neckline of the base breakout, that had become a basis of support in recent weeks, would continue to hold.
The market tested the support (with a brief dip to 12,594 yesterday) but subsequently then rallied to close with a positive candlestick (given the close was 30 ticks above the opening level) and now the bulls are continuing to run higher today.
Momentum indicators on the daily chart are reflective of a range play, with the RSI ticking up above 40 again and MACD lines still around neutral.
This is re-iterated on the hourly chat with the momentum indicators recovering following yesterday’s sharp downside move.
Continue to play the range whilst fluctuations in risk sentiment throws traders back and forth.
Another positive candlestick today would help with this move to unwind the market back towards the mid-range pivot again.
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