DAX Xetra (cash index)
As the market has slipped back over the past few sessions, it is now crunch time for the recovery.
Will the breakout above the 111,000 pivot hold?
The DAX has now fallen for the past two sessions, back from Friday’s high of 11,217 but it was interesting to see yesterday’s candle lacking conviction in the move lower.
Momentum remains strongly configured with the RSI still above 50, whilst Stochastics remain above 80.
However, if these conditions fail then there will be a growing potential that the recovery is decisively rolling over.
The support of a four week uptrend channel comes in at 10,982 today and adds to the importance of this pivot area.
On the hourly chart it is interesting to see that hourly RSI is back around 40 (where all of the rallies of January have kicked in), whilst the MACD lines are unwinding back towards neutral and the hourly Stochastics have ticked back higher.
- This looks to be an opportunity for the bulls, as long as the support around 10,980/11,000 holds firm.
- Initial resistance is at yesterday’s close of 11,090 before 11,142 and then Friday’s high of 11,217.
- Below 10,980 would be disappointing now, whilst the bears gain traction below the support band 11,787/11,822.