DE30: Technical overview

Summary:

• German Dax falls close to 6-month low

• Tuesday’s bounce proves short-lived

• Is the weekly trend turning lower?

W1

The Dax has been in a strong uptrend for the best part of the last 8 years as shown by price being above the 200 weekly SMA. The only time since 2011 that there’s been a sizable amount of weeks below this indicator was around the turn of the year. With price back below this, the long-term uptrend is once more under threat. Also note the gradient of the SMA which has flattened off and if it starts to point lower this could add further weight to the notion that the trend is turning down. Source: xStation    

D1

On a daily chart the Dax has extended lower after ending yesterday below the 50% fib retracement at 11458. Wednesday’s candle is particularly ugly, not just because it engulfed the previous session in a bearish way but also because it closed right on the lows. Downside targets from Fibs can be found at the 61.8% (11178), 78.6% (10778) and even the 100% (10269). A daily close above the 38.2% (11739) would be needed to invalidate this break lower. Source: xStation

H1

The market has fallen more than 1200 points since the ECB disappointed markets last month and set this move in motion. Today’s break below prior support around 11430 has opened up the possibility of another leg lower. RSI of 26.8 is in oversold territory but doesn’t indicate extreme conditions. Source: xStation