DAX 40 Remains in Strong Overbought Zone
The German index has recorded eight consecutive sessions of gains, appreciating more than 5% in the short term. The price level of 21,400 points now stands as the all-time high barrier for the current long-term bullish trend.
Strong Trend:
The bullish momentum that emerged after the significant drop in August 2024 has been key to the continuation of the long-term uptrend. However, the accelerated pace of buying in the short term could lead to bearish corrections in the coming sessions.
RSI:
The RSI indicator shows an impressively bullish slope, currently displaying readings of 83—well above the overbought level of 70. The current event in the DAX price indicates that recent movements have created an imbalance in bullish and bearish forces, which could trigger early bearish corrections as the price continues to advance.
Key Levels:
By Julian Pineda, CFA - Market Analyst
Strong Trend:
The bullish momentum that emerged after the significant drop in August 2024 has been key to the continuation of the long-term uptrend. However, the accelerated pace of buying in the short term could lead to bearish corrections in the coming sessions.
RSI:
The RSI indicator shows an impressively bullish slope, currently displaying readings of 83—well above the overbought level of 70. The current event in the DAX price indicates that recent movements have created an imbalance in bullish and bearish forces, which could trigger early bearish corrections as the price continues to advance.
Key Levels:
- 21,400 points: Positioned as the new resistance zone at the latest all-time high. Consistent buying pressure is necessary to maintain the bullish bias currently observed in the index.
- 20,300 points: The nearest support level on the chart and a potential area for bearish corrections in the short term. If the price drops below this level, sustained bearish pressure on the DAX could return.
By Julian Pineda, CFA - Market Analyst
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