Good morning traders!
Be on high alert today with the news events a bit later on.
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Dax Daily Chart
The disparity between the German Dax and the US indices continues to become more and more obvious as the US indices continue with yet another ATH, but the Dax continues to lag behind. The Dax has posted four consecutive bullish candles and grown around 2% in that time but now comes up against resistance around 11900 and there is historical resistance which I will look at on the lower time frames.
The central banks have the ability to provide the catalyst needed for the next decision point. The momentum strongly favours the bulls at first glance.
01 Dax Daily Chart
Dax Hourly Chart
I stripped the chart back to clear again and marked out the previous support/resistance zones. The bold black lines came from the daily chart over the last few of years (after taking it back to just the line chart, not candles). This will be useful for the next few weeks.We have the 11874 line directly above, which goes back a couple of years and was also previous resistance in January. A clear break above this first level opens up
We have resistance at 11874 directly above us. This level goes back a couple of years and was also previous resistance in January. The line may not specifically be resistance, but the zone of 11875-11900 may limit longs in the short term. A clear break above this first level opens up a move towards 12000.
Alternatively, if price is rejected at 11900, I like the look of a retracement back to 11700.
So a couple of options are available to bulls for a manual trade: long from 11710 or long on a break above 11925. An option exists for bears: short from 11900.
03 H1 Dax Chart
