DAX Xetra (cash index)
A near term recovery has been aborted as the market has retreated in the past couple of sessions amidst a move away from riskier assets.
In this environment of concerns over trade tariffs and what will come out of the G7 meeting, the export heavy DAX is likely to suffer, and that is exactly what is happening.
A mini uptrend channel has broken down with the resistance around 12,918/12,925 forming a barrier to gains this week.
A bearish candle yesterday has been followed by an opening gap lower today and now this move becomes key for the medium term outlook.
Can the bulls continue to hold on to the key breakout support around 12,600?
The late May correction hit an intraday low of 12,547 but the base pattern that formed on a breakout above 12,600 held the neckline support into the close and clearly this is a level that the market is looking at now.
- This morning’s initial gap lower into the 12,600s is holding the neckline support again but a close below 12,600 and/or an intraday move below 12,547 would begin to seriously question the sustainability of the renewed medium term recovery of May.
- The gap is open at 12,760 and still needs to be filled but there is now resistance 12,729/12,760 as overhead supply.
How the market reacts to this resistance could be key now in the coming days.
"DISCLAIMER: This report does not constitute personal investment advice, nor does it take into account the individual financial circumstances or objectives of the clients who receive it. All information and research produced by Hantec Markets is intended to be general in nature; it does not constitute a recommendation or offer for the purchase or sale of any financial instrument, nor should it be construed as such.
All of the views or suggestions within this report are those solely and exclusively of the author, and accurately reflect his personal views about any and all of the subject instruments and are presented to the best of the author’s knowledge. Any person relying on this report to undertake trading does so entirely at his/her own risk and Hantec Markets does not accept any liability.