We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/AJlT2YKeCu
  • USD/JPY is approaching medium-term uptrend resistance and while the outlook remains constructive, the advance may be vulnerable near-term while below confluence resistance. Get your $USDJPY technical analysis from @MBForex here: https://t.co/93D7AyhHtG https://t.co/KQcLLrkMP3
  • AUD/USD has had the most impressive show of trend over the past couple of months with the pair gaining almost 1500 pips from the March low. Get your $AUDUSD technical analysis from @JStanleyFX here: https://t.co/vLz4Rpln3u https://t.co/AOwnJja5V8
  • Has the #Euro been saved? Find out from @CVecchioFX here: https://t.co/eiXfOTyGa6 https://t.co/AyRiYpb4cN
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/ygwjGNvS61
  • The $USD, Euro, British Pound and Australian Dollar will all be at the mercy of political developments in Asia, Europe and North America this week. An avalanche of PMI data will set the backdrop. Find out from @ZabelinDimitri here: https://t.co/L8cfAgVx94 https://t.co/THWhPAS6AM
  • The price of #gold plunged 1% immediately after the stunning US jobs report crossed the wires. Get your market update from @RichDvorakFX here: https://t.co/8i0L6YIqjy https://t.co/y9dIXazJf9
  • S&P 500, Dow Jones, Nasdaq explode higher with stocks surging in response to shockingly better-than-expected monthly jobs data. Get your #equities market update from @RichDvorakFX here: https://t.co/nuMVWOzzuC https://t.co/M3nGBjd7kZ
  • The record-breaking NFPs increase behind us and the FOMC rate decision on Wednesday sets the tone for my trading video: 'Dow Soars Above 200-Day Average on NFPs, Will the #Fed Keep the Dollar Sliding' https://www.dailyfx.com/forex/video/daily_news_report/2020/06/06/Dow-Soars-Above-200-Day-Average-on-NFPs-Will-the-Fed-Keep-the-Dollar-Sliding.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/kquvec5HVc
  • Seasonal factors, oversupply issues and the outbreak of COVID-19 has seen the price of liquefied #naturalgas (LNG) fall to 22-year lows (1.519), with the situation exacerbated by ‘fuller-than-normal’ storage facilities. Get your market update here:https://t.co/VOqfkBQ4aR https://t.co/OsaphmqEmu
DAX Technical Outlook: Lower Levels Likely Ahead

DAX Technical Outlook: Lower Levels Likely Ahead

2017-08-03 08:41:00
Paul Robinson, Strategist
Share:

What’s inside:

  • DAX positioned for April gap-fill and move below 12k soon
  • Euro not helping, correlation strongly negative but can change without warning
  • Volatility is offering more to traders than in other major benchmarks (S&P 500)

Find out in our Q3 Forecast what’s driving the DAX and Euro.

In Tuesday’s post, we discussed the positioning of the DAX as remaining bearish, with the ‘head-and-shoulders’ top having triggered and the French election gap on the verge of filling. It was that same day we saw the DAX put in a fairly strong bounce, popping back above the neckline of the H&S formation and testing the top the of the election-gap. But that was where it all ended as now the German index is working its way towards a gap-fill and likely sub-12k soon.

The trend is undeniably weak since hitting a record high in June, the weakest of major global indices at this time. The euro continuing to press on to two-and-half year highs is certainly not helping the cause for investors. The correlation between the DAX and euro is a strongly negative 87% over the past three months. For traders, the trend higher in the euro, lower in the DAX has provided opportunity in a low-volatile global market environment. It’ll be interesting to see if the strong relationship between the two will persist should we see a turn in the euro (As we discuss regularly in webinars, correlations can get turned on their heads without warning.)

The DAX volatility benchmark – VDAX – is trading up over 14, which still isn’t very high, but certainly an improvement from the string of sub-10 readings we recently saw in the VIX, the volatility benchmark for the S&P 500. So, if there is a major global index to look to for volatility it’s the DAX, along with the Nasdaq 100, which has also experienced volatility in its own right. The Nasdaq 100 volatility barometer – VXN – is trading over 14.

Getting back to the chart, the DAX cash index only has a little distance to drop before filling the French election gap at 12048. The next level we’re looking to, though, really comes in under 12k at a swing-low in April at 11941, followed up by the 200-day and March low in the 11870/50 vicinity. As we’ve said before, the measured move target for the H&S formation isn’t until 11630, but it’s actual price not derived levels which we are most interested in. How the DAX responds should it test those levels will be the tell as to whether we are in for a much broader move lower or an abbreviated drop from a bearish topping formation.

Paul conducts webinars Tuesday-Friday. See the Webinar Calendar for details, and the full line-up of upcoming live events.

DAX: Daily

DAX Technical Outlook: Lower Levels Likely Ahead

---Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email by signing up here.

You can follow Paul on Twitter at @PaulRobinonFX.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.