DAX/CAC Technical Highlights:
- DAX treading water for now, still in an uptrend
- CAC holding slope support following coronavirus gap-fill
European stocks have held up well recently following strong runs, with the DAX trading right around record highs. Generally speaking, the trend is favorable for higher prices from here, but waiting for a period of consolidation could offer traders a better risk/reward opportunity.
While the DAX is poised for further gains, horizontal movement may create a strong base and help define near-term levels. In doing so, should we see a dip lower in the very short-term, holding 14422, yesterday’s low, will be key.
But even if that were to break the weekly low it doesn’t necessarily turn the picture bearish with trend support rising up from the tail end of October. On the top-side, there is an upper parallel to watch as resistance, a line that is was established off last week’s high.
From a tactical standpoint, for now, in a holding pattern.
DAX Daily Chart (holding in record territory)
The CAC 40 pulled back to support via a slope extending higher from late November. This comes following the long-awaited fill of the coronavirus gap in Feb 2020. This puts focus on the 2020 high at 6111 as the next top-side objective.
The general outlook is similar to the DAX, but it will be important for the CAC to hold slope support to keep it supported in the near-term.
CAC Daily Chart (holding support)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
