DAX Technical Analysis: Double Top Playing Out
- Index trading lower alongside other risk assets
- Break below 10,500 potentially playing out a double top pattern
- 10,340 still capping losses in the short term
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The DAX (CFD: GER30) is trading sharply lower today, as a bound rout worldwide is seeing yields surge while prices fall alongside equities.
Indeed, stocks and bonds correlation currently sits at the highest level since 2008.
The index broke a key support area below 10,500- perhaps signaling a breakdown from a double top pattern formed below the 10,750 resistance.
At this stage, the DAX is sitting at a potential support around 10,340 which coincides with a long term trend line from the April 2015 highs.
A breakdown might expose possible support at 10,125 followed by the big 10,000 figure.
A move higher seems likely to face resistance below 10,500, with price action appearing bearish as long as price stays below that level.
DAX H4 Chart: September 12, 2016
--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com
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