DAX Xetra (cash index)
A significant deterioration in sentiment has seen the DAX making a key breakdown of support in a move that marks another milestone in the sell-off.
An intraday rally did not last long yesterday and closing lower with a big bear candle has been followed today with a big gap lower at the open.
Initial support at 11,459 has been breached but also just as importantly the support at 11,400 has been breached.
- There is a gap still open at 11,497 now and needs to be filled but equally, the market will now see 11,400/11,497 as a near term sell zone.
- Having lost the support of 11,400 which was a consolidation zone from December 2016/January 2017, now means that there is little real support now until 10,800 although the tacit support of a seven year uptrend comes in around 11,000.
Momentum indicators remain deeply negatively configured, with the Stochastics and RSI in bearish decline, whilst the MACD lines are accelerating lower.
Any technical rally is now a chance to sell.