Hello traders, after the German holiday yesterday, the market has some catching up to do and we saw a nice gap this morning, which as I write this article, seems to be closing now. So let’s take a look at the markets.
The economic calendar is pretty light today, with the BoE inflation report hearing provided the most exciting impact. Click here to see the economic calendar.
22-05-2018 Dax Outlook
- Clear bullish trend
- Bullish above 12915 (trend defining level)
- Buying zones are around 13000
- Has not seen a major correction since March
Let’s look at the charts. Using the 20-minute chart below, I am drawing the black fork from the three most recent major pivots. The gap from this morning has taken us up to the UMLH of the black fork. The question now is whether the price responds to this level and retraces back to the median line, or whether we zoom through the UMLH.
The blue downsloping fork is an MML drawn from the closing price of three mini pivots. And MML can often be a good tool for choosing an entry.
The most reasonable expectation this morning is for the gap to close. This should bring the price back to the 13,060 level which may interest some buyers close to the LMLH of the previous fork, which is now grey.
Overall the market is bullish above 12,915.
Looking at the 4-minute chart below, I really like how the price has responded, twice, to the UMLH of this 4-minute black fork.
The price has also ‘gapped’ the median line.
You could even draw a new fork using the recent high from this morning as the new C point. Using that new fork notice how pthe rice is retreating back to the median line.
22-05-2018 Major Indices Analysis
FTSE
- Bullish trend
- Remains bullish above 7754
- The ML of the black fork looks a nice spot
DOW
- No strong trend, but slightly bullish bias
- Looking for a retracement to the black ML
SPX500
- Watching if price responds to the second fork UMLH
- Bullish trend, the trend defining level is the lower pivot just before the major gap
NASDAQ
- No clear trend
- The price has broken above the previous [grey] bearish fork UMLH and holding the LMLH of the new bullish fork
- But the price is still below the two recent major pivot highs
- Watching to see if price holds above 6850
