Current Bias: Bearish – perhaps with profit taking

Support: 9382, 9200, 9148, 9059

Resistance: 9411, 9440, 9542, 9581

Talking Points: FTSE, Russia and the Ruble, Oil prices, Dax profit taking, Short squeeze

Dax Market Commentary

This morning I had a clear vision that today was going to be another sell off, so I entered a number of trades; sell dax, sell USDJPY, buy EURUSD, believing them to share some sort of correlation (inverse or otherwise), the initial sell off suggested I would be correct, however the gains have now been parred and we have dug deep into drawdown territory. I failed to see that 9217 is the 50% fib from the recent Oct/Dec swing, almost perfectly to the point, but this perhaps explains the sudden and aggressive pullback.

The Dax yesterday opened up a low volume pocket when it dropped from 9532 down to the second distribution between 9300-9400. The low volume pocket can be mapped with lines at 9530 and 9411. Yesterday the 9411 was tested and held and today we have made a couple of attempts to take it out, but so far it has been resistive. The second retest could be significant.

General sentiment has shifted drastically from bullish to bearish and the next decision to make is where abouts the bulls are looking to step in and retake control, knife catching is of course a dangerous game but I would expect them to be waiting to go long from closer to 9000.

Dax Technical Analysis