Dax Technical Analysis 25/08/2016

Hello traders!

I am finally home, back from the break and ready to get back into action again.  So as it’s late into the trading day, I will jump straight in to it.

Dax Daily Chart

I have been watching the daily chart fairly closely recently and we have a bullish support zone between 10320-10500. I am expect for price to want to reach this zone and find its feet before building higher. The first attempt (on the 22nd) to test this support, held comfortably and we now seem to be lining up a second test. So I am thinking that we may see a couple of days of neutral/bearish behaviour as price looks to reach 10350, before heading much higher if it holds.

01 Dax Daily Chart

Dax 4 Hour Chart

We have been in a bullish trend since the end of June, with the classic ‘higher highs and higher lows’ evident on the chart. This trend began shortly after the bullish divergence and catching or trading that move, which tends to be a strong signal, could have earned over 1,000 points, so trading at £10 per point would have earned you a decent month.

We remain bullish above 10090 and there will be resistance to break at both 10650 and 10800 before confirmation that the trend continues. An opportunity exists to place a buy order between 10450-10500, stop below recent low and ‘target 1’ being a test of the resistance levels, or ‘target 2’ being a break above 10800.

02 Dax H4 Chart

Dax 30 Minute Chart & Dax 5 Minute Chart

We are currently below the weekly pivot (pivot point indicator) and below the 34-hour EMA which I like to use for short term trends. We initially pierced the S1 at the beginning of the week and markets tend to try and I am wondering whether those levels are re tested again. Other interesting horizontal lines for your charts, besides 10650 and 10800 are 10460, 10700 and 10730.

The 5 minute chart just looks nasty. Really choppy, no real direction, but have decent trending moves from one side of the range to the other. In ranging markets, oscillators (RSI, Stochastic etc) tend to perform really well.

Wait for a break to trade, nothing exciting happening at the moment.

Dax Support & Resistance