Good Day and I hope you are well.
comment: Not as bearish as I am on dax but I think market should not go above 21200 again and continue down. For that to happen, bears need to leave a strong bear gap somewhere. Gap down on Monday or Tuesday will likely do the trick. If the bull trend line holds and the current bear trend line breaks, There is the small possibility of another leg up but for now I can’t see that happening.
current market cycle: trading range
key levels for next week: 19000 - 21000
bull case: Bulls need to stop the selling and reverse to above 21000 fast or bears will push this much lower. If they manage to stay around 21000, more bears could doubt the strength of this selling but it’s a weak argument as of now. If bulls go only sideways around 21000 and close Monday above it, that would change a lot to the better for them. They have support from the daily 20ema until clearly broken.
Invalidation is below 20600.
bear case: Bears see a clear topping pattern with at least 3 decent tries of going above 21350 and now we have the strong selling on Friday with a total escalation of the trade war with the EU. Bears were given a gift and they need follow-through and leave a big gap that has to stay open, like the bulls did with the 3 current open gaps. Targets for the bears in order are the breakout retest 20277, 20000 and then the prior support around 19300/19400 which is around the 50% retracement.
Invalidation is above 21200.
short term: Neutral until we clearly have follow-through selling by the bears. I want to lean max bearish but need more confirmation.
medium-long term - Update from 2024-05-24: Will update this section more after the coming week but in general the thesis is as for dax. Down over the summer and sideways to up into year end. I don’t think the lows for this year are in.
comment: Not as bearish as I am on dax but I think market should not go above 21200 again and continue down. For that to happen, bears need to leave a strong bear gap somewhere. Gap down on Monday or Tuesday will likely do the trick. If the bull trend line holds and the current bear trend line breaks, There is the small possibility of another leg up but for now I can’t see that happening.
current market cycle: trading range
key levels for next week: 19000 - 21000
bull case: Bulls need to stop the selling and reverse to above 21000 fast or bears will push this much lower. If they manage to stay around 21000, more bears could doubt the strength of this selling but it’s a weak argument as of now. If bulls go only sideways around 21000 and close Monday above it, that would change a lot to the better for them. They have support from the daily 20ema until clearly broken.
Invalidation is below 20600.
bear case: Bears see a clear topping pattern with at least 3 decent tries of going above 21350 and now we have the strong selling on Friday with a total escalation of the trade war with the EU. Bears were given a gift and they need follow-through and leave a big gap that has to stay open, like the bulls did with the 3 current open gaps. Targets for the bears in order are the breakout retest 20277, 20000 and then the prior support around 19300/19400 which is around the 50% retracement.
Invalidation is above 21200.
short term: Neutral until we clearly have follow-through selling by the bears. I want to lean max bearish but need more confirmation.
medium-long term - Update from 2024-05-24: Will update this section more after the coming week but in general the thesis is as for dax. Down over the summer and sideways to up into year end. I don’t think the lows for this year are in.
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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.