Dax Technical Analysis 11/07/2016

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Good morning traders!

I spent Friday in London and away from the markets for much of the day, so I didn’t get a lot of chances to trade, however I did manage to catch the NFP result. I caught a couple of quick trades on the cable which were great, but had a couple of losers on the Dax. I believed it was time to be bearish, but instead we have a bullish break out. The question for me is, how long it will last?

Daily Chart

We are below both the 200 EMA and the kumo cloud and carved out a significant lower high at 9800 which was previous support in May. Longer term we have broken the longstanding 4 year pitchfork to the downside, kissed it good bye from the downside and have been creating lower lows and lower highs since April. Watch a break of 9800 to challenge the bias.

4 Hour Chart

9770-9800 could be a significant resistance zone as price looks to challenge the recent highs after failing to break below the post brexit low. If we don’t take out this resistance zone then price looks set to range for a little longer.

30 Minute Chart

The zone mentioned above is approximately 50% of the post brexit range which may add some additional strength to the resistance. Lots of sideways movement at the moment.

5 Minute Chart

Strong bullish move on Friday, made pretty clear from the Black MetaTrader chart. We had a bearish channel created from the intra-day trading on Thursday which was broken early Friday morning. Horizontal resistance of 9500 was taken out. 9534 and 9563 were also marked levels of resistance, so taking these out pretty much confirmed the breakout. The was exhausted and topped out around 9650, trading sideways for the rest of the day.

If the bulls stay in control, then a pullback to the 9563 (or 9550 – near the weekly pivot point indicator) could be an interesting spot to go long.