DAX: Slowly Turning Higher, Line in the Sand Drawn
- The DAX is slowly turning up from support
- Higher prices anticipated, but…
- Choppy trading could be the biggest risk to this view right now, not sellers
The DAX continues to slowly turn higher after last Monday’s test of old resistance turned support. The confluence of previous peaks from April through June and trend-line are proving to be rather significant, leaving traders with a fairly clean line in the sand. Hold above the 8/22 low at 10386 and the bias is bullish, close below and a further retracement or worse becomes the risk.
Continued trade higher from the late June low will bring the 8/15 swing high into play, then a December swing high near 10900 and upper parallel of the trend-line running higher off the Feb lows (~11000).
The biggest risk in the very near-term appears not to be sellers stepping in and bullying the market lower, but rather a lack of good movement as we work our way through the remainder of the dog days of summer. With that in mind, there is a good chance trading will be choppy. Keeping trade size small and very selective is a prudent approach until market participants file back in from late summer vacation time.
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX.
He can be reached via email at email@example.com with any questions or comments.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.