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Recovery on hold again for the DAX as caution take hold


DAX Xetra (cash index)

A cautious look to the DAX in the past couple of sessions as the bulls have stuttered in their attempt to kick start the recovery again.

The uptrend channel is still a guiding hand for the bulls to make gains, whilst momentum indicators are positively configured on a medium term basis to suggest that weakness is still a chance to buy.

Although the negative candlestick from yesterday’s session suggests that the bulls are not quite ready for the next leg higher, the important basis of support comes with the breakout above 11,370 and the pullback 11,415 which gives a near term buy zone 11,370/11,415.

Whilst this holds as support on a closing basis, the bulls will retain a degree of control in the recovery.

Today’s cautious consolidation again suggests that there is a pause button pushed, and this is reflected in the flattening daily momentum and an increasingly neutral configuration on the hourly chart.

  • There is still a gauge to watch on the hourly chart with a pivot around 11,556 and a move above here that is held would be a positive signal that the bulls were beginning to get going again.
  • Subsequent resistance is yesterday’s high at 11,618 and 11,677.

 


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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.