DAX Xetra (cash index)
After another mixed session yesterday, the bulls have tried to make another move today, but can they sustain the momentum this time?
Since the uptrend channel was broken last week, the outlook has been increasingly questionable.
This was again seen with a closing level once more almost bang on the old medium term pivot at 12,600 yesterday, having failed in a run higher earlier in the session.
Near term resistance has been around 12,700, with yesterday’s high of 12,715 before dropping back again.
The bulls are having another go again today with early gains, but it was interesting to see that yesterday’s high came around the underside of the old uptrend channel (which today comes in at 12,725).
- Closing above 12,700 would be an improvement for the bulls, but whilst the market trades under the old uptrend channel, there will still be a sense of resistance to the move.
Momentum indicators are uncertain too, but there is a mild positive bias just coming through now as the Stochastics tick higher whilst the RSI and MACD lines are above their neutral points.
The hourly chart shows this rebound into the resistance but the move has simply unwound overstretched hourly MACD lines to neutral.
Is this another near term rebound that will struggle?
- The resistance around 12,700/12,725 could be key today.
- Initial support is 12,600 again, with 12,493 increasingly key.
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