Key moment for the DAX as trendlines converge

DAX Xetra (cash index)

For now, this corrective slip back from last week’s high of 12,458 has played out as an unwinding move within the recent uptrend.

The bulls remain in control of the move which saw support bolstered by yesterday’s positive candle that left support at 12,322.

This is all coming within the uptrend of the past two weeks which is rising today at 12,310, whilst momentum indicators are still hanging on to their configuration of improvement.

However, how the market resolves this phase of contemplation could be key for the next near to medium term move.

The downtrend of the past three months still looms overhead (at 12,480 today), with the potential that this rebound is just another unwinding move to form another lower high.

Hanging on to the uptrend recovery is therefore key, as is a continuation of the improvement in the momentum.

  • With a positive close and consolidation early today, yesterday’s low at 12,322 takes on added importance now (coming also just above the uptrend support).
  • A close above 12,400 would help to improve the outlook again, with a push above 12,458 renewing the upside move.

This is becoming a key moment for the DAX.