CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Corrections within the DAX consolidation still a chance to buy

DAX Xetra (cash index)

Consolidations within the recovery have tended to be seen as a chance to buy for the next bull leg higher and there is little to suggest this is not once more going to be the case.

Recovery remains on course to test the old key long term breakdown which is significant overhead supply between 11,725/11,865.

However, the DAX has stalled slightly since breaking decisively higher through the 11,567 resistance on Friday, posting a high at 11,677 as the market has drifted back towards the breakout again.

This is a situation that has been seen on numerous occasions throughout the recovery and should be the source of the next buying opportunity.

This comes with momentum indicators still strongly configured, with the RSI in the high 60s, MACD lines rising and Stochastics still positive.

  • The reaction to the early slip lower at the open today is encouraging for the bulls, rebounding off 11,570, however effectively there is now a buy zone between 11,416/11,556.

The hourly chart remains positively configured with RSI continually bottoming between 40/50 and MACD lines positive above neutral.

  • A move above 11,677 would open the test of the long term pivot band 11,725/11,865.

 

Richard Perry

Richard Perry

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