DAX 30: Case for New 2016 Highs is Building
- DAX holds support between 10100/000
- Recouping U.S. data induced sell-off on Friday
- Strong showing today should lead to next leg up
Yesterday was a very uneventful start to the week for the DAX, with its uninspiring 60-point range. We noted on Monday that if we are to regain confidence from the long-side it will need to quickly move higher and recapture Friday’s NFP/ISM Non-manufacturing induced sell-off.
On Friday, Euro-zone stock markets – led by the DAX – took a hit in sympathy with U.S. indices on U.S. data, but failed to recover with them. Since then the S&P 500 futures have rallied nearly 1.5% from its worst levels on Friday to current levels which mark the best of 2016. It looks as though today we are seeing a little ‘catch-up’ play kick in with the DAX as it attempts to take on Friday’s high at 10284. It could be on its way to catching up to making fresh 2016 highs as well.
The 10100/00 area the market is springing to life from holds critical if a higher low is to carve itself out. This area has been in play since early March and continues to be important. A strong showing today (it’s very early, but off to a good start) and break above the Friday high will go a long way towards building the bullish case for a break above the recent swing high at 10374 (5/31). The higher low, higher high sequence from late May should then continue to further itself up to the 4/21 high at 10486 and then possibly to a new high 2016 high, reaching the trend-line running off the 2015 record highs.
DAX (Ger30) Daily
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.