Hello traders!

I am having to type this morning on a different computer, which is much slower than my laptop so the simplest task such as loading up a chart is taking 5 minutes longer than normal, so today I will improvise and use my tradingview.com charts.

For the last week or so, we have been creating a technical bull flag and the trend has clearly been bearish with higher highs and higher lows. Traders were speculating a similar move this time as well with a breakout higher. We got the breakout yesterday, but there was no momentum and we were quickly rejected back to the ‘point of control’ 11575.

Yesterday we had the wedge pattern emerging on the lower time frames, suggesting that we would have a breakout, which could offer an opportunity to trade, but this failed, dramatically as it went in both directions over the course of the trading session. Stop losses were swept and traders were chopped up. The most significant part of yesterday’s trading was the piercing of 11680, despite it being very brief. This indicates to me that we are still bullish and can still look to use a conservative ‘Buy The Dip’ strategy.

For the bulls, there are a few buying opportunities:

  • Buy @ 11550 as this has proved to be a significant level of support recently and there is demand here (short-term)
  • Buy @ 11450 as this allows for stop losses to be swept under the 11550 level, it allows for the gap to close and it brings price back to a previous point of control according to the market profile (or at least a high volume area), this would set up a potential swing opportunity for those who like to trade that way.
  • Buy a breakout higher beyond 11680, as we still have not really managed to hold above 11630 for any extended period.

I have had conversations with various traders over the years, about trading the German Dax with conventional technical indicators like Fibonacci, RSI, Bollinger Bands, Pivot levels etc, and the most common theme I find in the conversation is that “the Dax does not act like a forex pair, its behaviour is not similar and therefore it doesn’t respect the levels/signals generated by these technical indicators.” Most of the time, I disagree, but it provides an opportunity for debate. Below (Dax Charts) is an example of the Dax respecting a couple of Fibonacci levels over the last 48 hours or so. I may have to do some videos around using Fib extensions soon.

For today, I am watching for an opportunity to go long.

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Dax Support & Resistance

KEY LEVELS
Daily R2 11796
Daily R1 11726
Daily Pivot 11624
Daily S1 11553
Daily S2 11452
200 Day EMA 10610

Dax Charts

Dax Buying Opportunities

Dax Buying Opportunities

Dax Breakout Fails

Dax Breakout Fails

Dax Respecting Fib Levels

Dax Respecting Fib Levels