In my previous post on DAX30 Index, I warned of a short and choppy road ahead with limited upside. DAX30 Index among other major equity indices then remained in more or less “pause-mode” with narrow trading ranges and vanishing momentum. So far, DAX30 Index has reached and exceeded my intermediate price target of 11’775 and was even able to post a new 20-month high at 11’893. This sounds all great great, BUT when looking at momentum, it does not look too promising, at least for the moment. In fact, despite the recent higher high in price, momentum (RSI 14) made a lower high and is therefore not confirming the price. This is not considered as healthy and warns of a possible consolidation. But a definite confirmation of such a consolidation can only be called when price falls through important supports/trendline. In the case of DAX30 Index, the supporting momentum trendline is already broken (warning!) and I now await 11’700 level to be broken before I act. If 11’700 area gets breached, I see downside to 11’435 and 10’800 (fibonacci retracement). I reckon DAX30 Index to remain within trading channel (green) for a while with 10’200 as an absolute low. On the longer term, I remain bullish and expect a test of 12’400 until June 2017 (likely in May/early June).
Conclusion: Do not chase upside in DAX30 Index, go short if 11’700 is breached (intermediate target 11’435).
Just after my last post, DAX30 Index has emerged to new highs and meanwhile reached my projected price target at 11450 points. Whereas EURUSD has plunged further and printed new 13-year (!) lows in the 1.0350 area. Despite the new highs along with the slowing momentum in DAX30 Index, I see further short-term upside to 11’775 area which is equal to the Fibonacci trend extension (9’214 / 10’495 / 11’775). But I would not chase upside too aggressively, rather (if even) trade little short-term long plays with tight stops. When looking on the intermarket picture, for instance EURUSD; it does not look too promising on the short-term side for further upside in DAX30 Index. Despite the new lows in EURUSD, momentum is slowing down and is not (yet) confirming the new lows which calls for some short-term bullish consolidation. Furthermore, EURUSD is about to complete its 5th impulsive wave which has the equal height as the 1st wave (equality). Target is around 1.0350 which is also along the support line of the channel which emerged in August 2015 (color: turquoise).
Conclusion: Intermediate upside targets in DAX30 Index and downside targets in EURUSD reached. Remain on the sidelines until further notice. Short and choppy road ahead.
DAX30 Index has finally made its break-out earlier this week off the multiply tested resistance area around 10’800. The inverted bullish triangle which was formed along this 5-months consolidation period, suggests of a price target of 11’450. The 11’450 as a target area seems even more legit as it also is an intermediate resistance given by its 1-year price high. Furthermore, EURUSD faces further short-term downside and confirms my view on the DAX30 Index.
In my last post on the DAX 30 Index on 7th January 2016, I warned of further short-term downside from 9’980 to 9’350 (read full post here). The timing was more than right as DAX 30 then slit over 600 points and made a new 1 year low at 9314.
Following a rebound attempt to 10’000, DAX 30 failed to complete an intermediate bottom and meanwhile dropped 10% within just two weeks to 8’980. Despite the new lows and higher volume, the final sell-off is still ahead of us.
It seems DAX 30 is within its final wave 5 of a minor impulsive wave. Given that fact, the 3rd wave extension and the fibonacci equality ratio extension, I reckon an intermediate bottom will be found at around 8’780. This suggests of another 200 points drop from here (-2.20%) with excessive volume. So it’s gonna be short, but painful.
On the intermarket side, further short-term upside in EURUSD to 1.14, its trend-channel resistance line, seems likely and would be align with the DAX 30 roadmap.
Conclusion: Too early to pick bottom in DAX 30 Index, final and strong sell-off to 8’780 still ahead. EURUSD, buy into new lows with target 1.14.
In my last update on DAX30 Index in mid December’15 (DAX30 vs. EURUSD – 14/12/2015), I have mentioned that I expected some upward short-term consolidation to 10’630 levels prior of another down leg to September’15 (9’900) resp. August’15 lows (9’350).
The upward rebound immediately followed the day after my post, kept on for two weeks and found resistance (10’860, +7%) at the major downward sloping trendline (blue) starting off the all-time high (12’390 – April 2015). A flag was built accordingly which is the most typical consolidation pattern, suggested of a short break before the trend resumes its precedent direction (bearish in this case).
DAX30 then fell like a stone and even dropped below its significant support at 9’900 area to 9’810 and is now trading at 9’980 which is still negative (-2.29%) vs. yesterday’s close.
Given the recent flag formation in combination with a fibonacci retracement extension, I expect DAX30 to proceed its downtrend to at least to 9’350.
Why 9’350? Firstly, 9’350 is the projected price target of the fibonacci extension and secondly it is the area of the absolute Aug’15 (9’338) and Sep’15 (9’325) lows acting as major support zone.
Meanwhile, on the price side, we have new intermediate lows in place, but momentum has not (yet) confirmed these price lows, so this relationship is currently diverging. Nevertheless, I expect this divergence not to remain for long and estimate some small consolidation followed by another downleg to August / September lows within next week.
Conclusion: In DAX30 Index, a rebound to max. 10’200 (38.2% Fibonacci retracement zone) is possible, but do not chase upside. Instead, sell into weakness. Projected downside price target: 9’350 (-500 Pts. / roughly -5%).
With the recent development in the German DAX Index and its inverse correlation to EURUSD, technicals look promising for some further upside until year end.
After the double-bottom formation built during Q3/2015, DAX30 was able to strongly rebound to (almost)Â 11’000 levels. The measured price target given by that double-bottom formation suggests of upside to 11’650 (+6%). Nevertheless, the momentum is still very strong but slightly overbought, suggesting of not chasing the upside to heavily and instead wait for a breach of the resistance line (blue) starting off April this yearÂ – break-out zone in numbers: 11’150 – 11’200.
The intermaket perspectiveÂ supports this scenario: we have EURUSD just recently crossed below its 7-month trend-channel led by a momentum trendline breach and in combinationÂ suggests of further downside in the next couple of weeks / till year end. First support could be found at 1.08 with further downside and a test of the 12-year low at 1.0462.
Conclusion: do not chase upside in DAX30 too aggressively, rather wait for break-out confirmation! Slowly short EURUSD at current levels (Risk Stop: 1.1150).
Along with our last week’s roadmap, USDCHF, GOLD, COPPER, CRUDE OIL WTI printed new highs meanwhile the Treasuries (Bund & US 10Yr), EURUSD, EURJPY, GBPUSD, AUDUSD slipped to lower levels and Equity Indices remained in consolidation mode as anticipated.
Highlights (Week 37):
DAX30 – make-or-break!
SMI – caught in the middle.
S&P500 – 1920 to hold?
EURUSD – further downside to come.
GBPUSD – to bounce or not to bounce?
EURJPY – bottom in sight?
USDCAD – do not chase upside!
USDJPY – was that the top?
GOLD – too early to turn bullish.
COPPER – bottom found?
CRUDE OIL WTI – to proceed its bounce?
As anticipated in our last week’s “Technical Weekly”, we expected further downside in DAX30 and SP500. Also according to our last weeks release, the German Bund and US-10 Year Notes have proceeded to higher highs along with EURUSD, USDCAD and Gold. Moreover, Crude Oil WTI has reached our suggested support at 38 and rapidly rebounded as expected. For the upcoming week, we have several make-or-break scenarios especially on the Equity Indices side.
Highlights (Week 36):
DAX30 â€“ retest of recent lows to be expected?
SMI – is the panic over? New highs in sight?
S&P500 – trading at 50% retracement, now rebound to all-time highs?
GERMAN BUND – to proceed to higher highs?
EURUSD – to drop to 1.09?
EURCHF – swiss franc to weaken further?
USDCHF – parity in sight?
USDCAD – sky is the limit?
GOLD – proceed its rebound?
CRUDE OIL WTI – bottom found?
Highlights (Week 35):
DAX â€“ further downside expected?
EURUSD â€“ taking a short breather.
USDCHF â€“ make or break?
EURJPY â€“ more upside to come?
Silver â€“ intermediate reversal?
Crude Oil WTI â€“ still bearish but…
Read our report here: REVIVE-INVESTMENTS-WEEKLY-35-2015
Highlights (Week 34):
DAX – downside limited, further upside expected
USDCAD – rapid breakdown ahead
EURJPY – short-term upside expected
Crude Oil WTI – further downside expected but limited
Gold – ready for an intermediate rebound
Read full report here: REVIVE-INVESTMENTS-WEEKLY-34-2015
DAX30 Dec14 Future has opened today at 9307, so slightly above our target of 9300. Our target is therefore being reached and leaves us with a profit of 457 points or EUR 11’425 if 1 DAX30 Future was bought.
Stay tuned for upcoming trading ideas.
In the meantime, we wish you an excellent weekend!
DAX30 has advanced as expected and we are currently trading roughly 300 points above the opening price which is 8850. Our target at 9300 is still in place and we hereby recommend to raise the stop-loss into the profit area at 8860.
In the meantime, happy trading!