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Negative pressure grows on DAX as rallies are being sold


DAX Xetra (cash index)

The negative sentiment on the DAX continues to slip through the market as the bear drift backwards under the three and a half month downtrend.

Within this move, intraday rallies remain a chance to sell.

Even though, the market looked set for a decent recovery yesterday, the move sold off into the close to leave resistance at 12,349 and the market has dropped back lower in early moves again today.

A strong US Non-farm Payrolls report could be a trigger for further selling pressure on the DAX.

Technically the corrective signals on the momentum indicators are increasingly concerning, with the Stochastics dropping decisively, RSI below 40 and MACD lines are on the brink of a bear cross under neutral.

  • These are still suggesting a retreat back to 12.100/12,130 and a close below there would open the September low of 11,865.
  • Today’s traded high of 12,245 is initial resistance now.

The hourly chart reflects the bearish drift of lower highs, lower lows and momentum indicators implying rallies are a chance to sell.

 


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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.