DAX TECHNICAL ANALYSIS WEEK 39 – Friday 27th September
This is the last day for the DAX TECHNICAL ANALYSIS WEEK 39 article and today we found the short-term price action turning bullish again after yesterday’s break through the previous days high. Today we have already broken yesterday’s high. If we look left we can see that this 350 zone was a previous value area from Monday afternoon and Tuesday morning. I would like to see that area fall and price continue with its momentum.
Next week the algorithm should return which leads to additional DAX-related signals after successfully completing some much needed maintenance. Hear more about that next week.
For today, let’s keep up to date with the releases and the news as the week draws to a close.
|Point of Control||12294|
|Value Area High||12303|
|Value Area Low||12277|
DAX TECHNICAL ANALYSIS WEEK 39 – Thursday 26th September
Yesterday’s DAX price action was pretty bearish. The price failed to make any major bullish progress past the daily pivot in the early morning, before collapsing through the overnight lows, closing the gap, breaking the previous day’s low and then finding an interesting camarilla pivot, twice.
That camarilla pivot level at 12146 (dashed line at lows from yesterday) acted as support twice, creating a double bottom. That DB provided the platform for the price to bounce.
As for today, as is so often the case with Dax, we have an almost opposite day. I say that because we gapped lower (instead of higher), then failed to make much progress below the pivot (instead of above) and have now broken above the overnight highs (instead of the lows), closed the gap and now challenging yesterday’s high (instead of the lows).
This kind of price action is indecisive, but it is at least showing signs of momentum again. Which is what we want.
DAX Major Trend
12388 is the area to watch for now, with the DAX putting in a consecutive series of lower lows and lower highs. It’s also the composite high volume area.
DAX Minor Trend
Watch the resistance zone as this was tested again today and there’s another failure.
|Point of Control||12180|
|Value Area High||12235|
|Value Area Low||12138|
Last night, ECB board member Sabine Lautenschläger resigned (by 31 October 2019). The press statement does not provide an explanation for her resignation; however, we note that the ECB just launched a stimulus package and given that she was among the most hawkish in the governing council, there may be a connection. The near-term monetary policy implication is that the ECB will have only 5 board members until a replacement is found. Her replacement is likely to be less hawkish than she is. Last time a board member resigned was in 2011 (Jurgen Stark) due to the launch of non-standard measures taken at the time.
DAX TECHNICAL ANALYSIS WEEK 39 – Wednesday 25th September
“Give someone a fish, feed them for a day. Show them how to fish and feed them forever.”Subscribing to DAX signals is not just a case of receiving a notification when my algorithm makes a trade on one of my MT4 accounts, it’s about learning how to use the DAX strategy so you can generate your own trading opportunities to grow your trading business. I provide all the tools you need to get started. So don’t panic if my algorithm does not open a trade, because you can see all the setups for yourself. That’s what the service is about.
DAX Breaks To The DownsideSo why are we seeing these moves now? I think it’s a combination of factors, but ignoring the technicals for now we know that yesterday, the UK Supreme Court ruled that the prorogation of Parliament was unlawful meaning the Parliament will return later today. According to our UK economist, this ruling is a clear blow to PM Boris Johnson’s authority (and not least his chief advisor Cummings) yet no game changer for the Brexit end-game as the Delay Bill has already been passed. We think the most important element for markets is whether the Brexit deadline is delayed or not and we do not believe this ruling has affected that probability. This would have had some impact on the surrounding markets. Impeachment concerns have risen in the US as a whistle blower within the intelligence community claims that President Donald Trump repeatedly pressured Ukraine’s President to investigate Hunter Biden, former Vice President Joe Biden’s son, on a phone call back in July. Under the constitution the President can be impeached for “treason, bribery, or other high crimes and misdemeanours”, which is open to interpretation. Overnight, House speaker Nancy Pelosi announced a formal impeachment inquiry into the President presumably enlisting a foreign power to help influence presidential elections. Trump has denied all wrongdoings and stated he will release the phone call transcript later today. Yesterday, US stocks reacted negatively to this new political risk, also reflected in current ‘red’ Asian indices. This morning, however, US equity futures are roughly flat. Trump is only the fourth President to face impeachment proceedings; the last was Clinton in 1998. So far no President has been directly removed (Nixon resigned). The impeachment enquiry will start in the House of Representatives where only a simple majority is needed to bring charges forward (Democrats need no Republican votes here). This could lead to a trial in the Senate where the Chief justice of the US Supreme Court presides and where a two-thirds majority is needed to convict the President. Meanwhile a Senate vote would likely require c.20 Republicans to vote against their own party making it less likely unless new information reveals and confirms more severe wrongdoings by the President.
|Point of Control||12337|
|Value Area High||12375|
|Value Area Low||12262|
Tuesday 24th September
No Video Today – Back Tomorrow
|Point of Control||12320|
|Value Area High||12348|
|Value Area Low||12284|
In his comments about opposing QE, ECB policymaker Francois Villeroy de Galhau said on Tuesday he supports many elements of new stimulus package including state-dependent forward guidance and tiering introduction. He commented rate cut in combination with new guidance is a powerful combination.
However, he added further asset purchases are unnecessary right now saying that he was “not in favor of the resumption of net asset purchases at this time, because I thought that further purchases are unnecessary right now, and I stress right now, given the very low levels of both long-term interest rates and term premia.”
He added he was being focused on the ECB’s new line, looking for fiscal stimulus from the Government to support the economy.
Still, he acknowledged the uncertainty surrounding the global economy and hinted that if the situation worsens, he will reassess.
Monday 23rd September
It seems that we have a mini-crisis developing in the German manufacturing industry. The German composite PMI fell in September to lows of 49.1, last seen in 2012, IHS Markit announced on Monday. The August index was 51.7. These numbers impact the DAX
The manufacturing PMI index was at 41.4, falling compared to the previous month’s 43.5 as it reached a 123-month low. Meanwhile, the services PMI activity index hit a 9-month low at 52.5. The services index in August was reported at 54.8. The survey said that inflows of new businesses declined for the third consecutive month and demand for exports was also lower.
Phil Smith, principal economist at IHS Markit said Germany may not see any growth by the end of 2019 and added: “The manufacturing numbers are simply awful. All the uncertainty around trade wars, the outlook for the car industry and Brexit are paralyzing order books, with September seeing the worst performance from the sector since the depths of the financial crisis in 2009.”
No Video Today – Back Tomorrow
DAX Major Trend
|Point of Control||12456|
|Value Area High||12467|
|Value Area Low||12425|