DAX Xetra (cash index)
In the wake of such a strong bullish breakout there is often a degree of consolidation to the move, which is being seen today.
A huge bullish candle on the breakout above the 12,600/12,647 resistance completed yesterday which completed a decisive upside break for a near three month high and freed the shackles for further upside.
However, now for the pullback.
The breakout resistance now turns supportive in the coming days and this means that 12,600/12,647 is now a key area of underlying demand on the DAX.
Momentum indicators confirmed the breakout with the RSI and MACD lines rising at a three month high.
- The market will now be eyeing the 13,000 barrier, with 13,140/13,300 the next band of resistance.
Just as with the FTSE 100 there is also an uptrend channel that is pulling the market higher on a near to medium term basis now.
Look to use any unwinding correction that finds support around or above the breakout as a chance to buy.
- The hourly chart shows a mini uptrend that is supportive this morning at 12,680.
- Yesterday’s high of 12,827 is initial resistance.
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