11-10-2018 Technical Analysis Levels

Morning traders.

I imagine the majority are looking for reasons as to why the sell-off yesterday was so aggressive. Massive financial meltdown pending? Interest rate speculation? Trade war hangover? Taper tantrums? Inflation issues? Geo-political? Economic? A combination of everything? Whatever it was, it has created a mess and the pieces and debris are still scattered all over the floor. What a ride. 

So, what we know is the DAX has now printed seven consecutive lower lows on the daily chart. We closed yesterday at the lowest levels since February 2017. Yet we gap lower again this morning. And it wasn’t a small gap either. It was 150 points! So within a 24 hour period, the DAX lost nearly 500 points. Probably the most common question around the retail community is, “how much longer can this continue before a pullback happens.” Well, don’t forget that the DAX always used to be a volatile market, high daily range with large moves, so perhaps this is just a [welcome] return to those days, because it brings opportunity. When we trade, we want momentum. We want moves that run. So I welcome it.

The News

European stock index futures pointed to a sharply lower open on Thursday with markets hit by the selloff on Wall Street. During the previous session, United States markets tumbled on concerns over rising interest rates as the Dow Jones plunged over 800 points. Following the selloff, yields on US Treasuries declined for the first time in days after jumping to multi-year highs earlier in the week. Meanwhile, US President Donald Trump strongly criticized the US Federal Reserve for tightening its monetary policy, claiming the central bank has “gone crazy.” Trump also claimed the selloff represented a “correction that we’ve been waiting for for a long time.”

The price reduction at Wirecard was particularly strong in Germany . The share price of the recent DAX addition, fell by 16 percent. Wednesday started bearish, but in the afternoon additional pressure came from the USA. On Wall Street, the US exchanges also started with heavy losses in trade. The International Monetary Fund had previously warned against turbulence on the financial markets. In particular, the technology sector. 

Trading Signals

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Key Levels