Dax Technical Analysis 07/09/2016

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Hello traders!

We are still range bound and at the moment, there is nothing exciting about the Dax. Commiserations to any other Renko traders at the moment, because these kinds of conditions are like our nemesis. The range we are stuck between is 10650-10750. In one way I am pleased that we have held above 10650 because it’s possible that this will become the new shelf or foundation, the new support level, from which price can build and right now I still remain bullish. I am wondering whether we are just coiling up waiting for the ECB outcome. Will they do nothing? Will QE purchases increase over the next few months after a slower August? All eyes on the outcome tomorrow!

Today is likely to be another slow day. So what strategies could be useful to trade during these circumstances? Range trading strategies, such as a my RSI system can be very effective. Sell at the top, buy at the bottom, simple. Just be ready to exit on a break out of that range.

Yesterday had a couple of interesting trading opportunities, but I didn’t really take advantage of any of them, mainly because I was slightly concerned about whether or not 10650 would hold. Price made a run for the daily S1 fairly early into the session, which held and price then made its way up the daily R1 which was aggressively rejected sending price crashing through the daily pivot and down the the daily R1. It held again. Since then we have been inside that 100 point range. So my outlook hasn’t really changed.

As far as trading opportunities go, right now, I don’t see too many. I see a break above 10750 perhaps taking us up to 10800, but the risk reward ratio is not great. Because beyond 10800 there is plenty of additional resistance, so I need some sort of additional fundamental catalyst to feed my bias. Thursday should at least satisfy some of that.