DAX Xetra (cash index)
After another day where the selling pressure resumed yesterday, an early rebound again gives the bulls a decision to make.
Is this a near term rebound that can be sustainable, or is it another chance to sell?
Near term technical indicators are beginning to tick higher with the RSI back above 40 and Stochastics beginning to pull higher.
However, medium term momentum is now suggesting that rebounds are a chance to sell.
The rebound this morning has also decisively broken the downtrend (which to all intents and purposes had been breached in the past couple of days, without being confirmed).
- Despite this though, there is a clutch of overhead supply now with 12,440/12,472 coming in initially as a band below the basis of resistance of the breakdown levels between 12,550/12,600.
The hourly chart shows the near term rebound and an unwinding move but still looks to be a move to simply renew downside potential.
- The rally this morning could still have some legs to run higher, however watch for sell signals in the overhead resistance to deliver an opportunity to sell for a retest of the 12,104 low and the medium term target at 12,000 in due course.
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