The German index DAX has given a second great opportunity to enter a long position today near 9330. With US futures up more than 15 points for the S&P and decreasing tension in Ukraine after the withdrawal of the Russian troops from the borders, markets are turning to risk again. The current price action in the DAX index is very promising specially if prices manage to break above the short-term resistance and double top at 9700-9730.
DAX has pulled back yesterday below the 50% retracement and almost reached the 61,8% Fibonacci retracement. Today’s positive climate amongst most equity markets has given the opportunity for buyers to bet on closing yesterday’s gap down. DAX is now heading towards important resistance levels as the descending blue trend line near 9680 as shown below is the first big test for bulls.
Our bullish view for DAX will be confirmed once we break above 9700-9730 and with 1015 as first target. It i very important to see how markets both in Europe and in US react when we reach our previous all time highs, as another reversal at these levels could bring a bigger degree downward correction. DAX short-term support below 9280 is at 9184. If today’s gap up is filled we should probably be heading towards 9200-9150. Trend is bullish and in favor of both short- and long-term bulls for now.
As always, thank you for taking the time to read my new post.