The German index has posted steady gains, rising nearly 7% over the last four trading sessions, mainly driven by the low interest rates maintained by the ECB at 2.25%, as well as the easing of potential trade war tensions, which has allowed the index’s bullish bias to remain strong in recent weeks. However, buying candles have been gradually diminishing over the last sessions, and it is likely that a selling candle may appear in today’s session, reinforcing short-term neutrality as the index trades above the 22,000 level.
Accelerated Trend: Since April 9, the DAX has shown significant upward movements, resulting in a fairly steep bullish slope and giving way to an accelerated uptrend. If the DAX fails to hold the recent weeks’ highs in the short term, this accelerated price movement could lead to corrective pullbacks. However, the dominant bias in the longer term remains bullish.
ADX: The ADX line has begun to decline and is now facing the neutral area marked around the 20 level. Frequent oscillations around this level indicate that volatility has decreased and could lead to sustained price neutrality in the short term.
MACD: The MACD histogram remains above the indicator’s 0 level but has shown a steady deceleration, which may signal a lack of momentum in the average movement of the moving averages. As the MACD histogram continues to narrow, it could pave the way for slight bearish momentum in the DAX’s daily chart over the short term.
Key levels to watch:
Written by Julian Pineda, CFA – Market Analyst
Accelerated Trend: Since April 9, the DAX has shown significant upward movements, resulting in a fairly steep bullish slope and giving way to an accelerated uptrend. If the DAX fails to hold the recent weeks’ highs in the short term, this accelerated price movement could lead to corrective pullbacks. However, the dominant bias in the longer term remains bullish.
ADX: The ADX line has begun to decline and is now facing the neutral area marked around the 20 level. Frequent oscillations around this level indicate that volatility has decreased and could lead to sustained price neutrality in the short term.
MACD: The MACD histogram remains above the indicator’s 0 level but has shown a steady deceleration, which may signal a lack of momentum in the average movement of the moving averages. As the MACD histogram continues to narrow, it could pave the way for slight bearish momentum in the DAX’s daily chart over the short term.
Key levels to watch:
- 22,000 points: A nearby support area coinciding with an important psychological level, which could act as a significant barrier against potential short-term price pullbacks.
- 21,400 points: A distant support area aligning with the 100-period simple moving average. Bearish movements reaching this level could threaten the bullish formation currently seen on the chart.
- 23,000 points: A definitive resistance level coinciding with the area marked by the DAX’s all-time highs. Buying movements returning to this level could trigger a consistent bullish bias and a much more relevant uptrend in the short term.
Written by Julian Pineda, CFA – Market Analyst
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.