DAX Xetra (cash index)
A near term recovery has been aborted as the market has retreated in the past couple of sessions amidst a move away from riskier assets.
In this environment of concerns over trade tariffs and what will come out of the G7 meeting, the export heavy DAX is likely to suffer, and that is exactly what is happening.
A mini uptrend channel has broken down with the resistance around 12,918/12,925 forming a barrier to gains this week.
A bearish candle yesterday has been followed by an opening gap lower today and now this move becomes key for the medium term outlook.
Can the bulls continue to hold on to the key breakout support around 12,600?
The late May correction hit an intraday low of 12,547 but the base pattern that formed on a breakout above 12,600 held the neckline support into the close and clearly this is a level that the market is looking at now.
How the market reacts to this resistance could be key now in the coming days.
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