DAX Xetra (cash index)
The recovery of early January has turned into a phase of consolidation now as the overhead supply around 11,000 has prevented the bulls from gathering a head of steam.
This comes with momentum indicators rolling over at levels that will be concerning for the anyone invested in continued recovery.
In early December the RSI failed at 53, and this time is struggling at 52; whilst the big renewed sell-offs of the near term rallies of recent months have all been signalled by Stochastics sell signals similar to the one forming now.
- However, the support initially at 10,788 helps to protect the more important near term pivot band 10,585/10,700 and whilst these levels remain intact then the bulls will still be confident of a test of 11,000.
The hourly chart shows a near term slip but seems to just be an unwinding move.
A move below 40 on the hourly RSI would be a concern though.
- Initial resistance at 10,898.
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