DAX Xetra (cash index)
There is a continued positive outlook on the DAX as the recovery that has been developing throughout 2019 rumbles on.
A consistent feature of this is that consolidations are used as a chance to buy into the next leg higher within what is now a broad uptrend channel.
Last Friday’s breakout above 11,556 has opened the upside once more, whilst leaving the breakout support band 11,370/11,415 as a key area of near to medium term support.
Although Friday’s session reflects a mild disappointment for the bulls as the prospect of a strong bull candle slipped away into the close, however, there is little reason to expect the bulls have run out of road quite yet.
The continued breaking through of resistance of old key highs has put the market on course to a return to the old key long term pivot band 11,725/11,865 which is the next big test overhead.
Momentum indicators remain strongly configured and weakness is a chance to buy.
The RSI is in the high 60s now with MACD lines pulling ever higher and Stochastics remaining bullishly positioned.
- There is a gap open at 11,525 but a support band 11,525/11,566 is now a near term “buy zone” should the market lose a bit of impetus with this morning’s gains.
The hourly chart shows anything around 50/55 on hourly RSI, or around neutral on hourly MACD is an area where the buying pressure tends to renew.
- Resistance initially at Friday’s high of 11,677.
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