Dax Technical Analysis 30/05/2016

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Hello traders!

It’s bank holiday for me here in the UK today, but of course the Dax is still open.

Global stocks are mostly higher at the moment and point towards Oil price recovery, China and interest rate expectations for fundamental explanations. Yellen said it will be appropriate to raise interest rates if the economy improves but stressed the Fed will move carefully and slowly. There have been signs of improvement from last week and the commerce department said the US economy grew more than previously estimated (in the first quarter). But markets seem to be accepting the likeliness of a rate hike.

Looking at the daily chart, price has clearly bounced and we are back inside the bullish channel and above the 200 daily EMA, however the bears will want to zoom out further to look at the previous, long-standing, pitch fork, we are approaching the underside of that. It will be an interesting trade off.

Intra-day today we are currently coiling up (5-minute chart), after initially rallying up the daily R2 (daily pivot point indicator) before taking out the R1 and finding support at the daily pivot. This seems to be the trading range and now we find price back at the R1 waiting for it’s next move. Trading a breakout could provide a good opportunity.

I am personally still bullish above 10050 and there are a couple of decent levels of support above that, such as 10165 and 10230. If we break lower from this intra-day coil up, I may look to buy from those two levels. Alternatively a break higher could be interesting.