Could DAX30 Broke Above the Current Range?
The momentum of the index has increased since the middle of August. But yesterday was a particularly bearish day for the German auto sector, as the markets responded to negative chatter from Beijing on trade.
The DAX30 index remains stuck in a narrow 13,100 - 13,300 range that has been in place for almost two weeks. The sideways consolidation can continue for some more time and the DAX is likely to break above 13,300 and resume its upside trend towards 13,400 - 13,500 eventually.
But until that happen the preferred trading strategy is Sells on the upper border of the range or Buys at the bottom limit. Today the price already tested the upper border of the Bollinger Bands and retreated. Now we expecting the price to test most probably the H4 50-day moving average at 13,115. If the DAX broke bellow it and under the downward line of Bollinger Bands, the bears could go further downside to the 23.6% Fibonacci retracement of the rally from October 4 to November 12 at 12,970.
The German Bundesbank’s monthly report warned that Q4 growth could stagnate, but with only a slight risk of a prolonged recession. There are no major data releases scheduled for today. A lack of stats will leave the major German index in the hands of risk sentiment throughout the day. Geopolitics continues to be the key driver, with updates from the U.S and China on trade talks in focus.
The DAX30 index remains stuck in a narrow 13,100 - 13,300 range that has been in place for almost two weeks. The sideways consolidation can continue for some more time and the DAX is likely to break above 13,300 and resume its upside trend towards 13,400 - 13,500 eventually.
But until that happen the preferred trading strategy is Sells on the upper border of the range or Buys at the bottom limit. Today the price already tested the upper border of the Bollinger Bands and retreated. Now we expecting the price to test most probably the H4 50-day moving average at 13,115. If the DAX broke bellow it and under the downward line of Bollinger Bands, the bears could go further downside to the 23.6% Fibonacci retracement of the rally from October 4 to November 12 at 12,970.
The German Bundesbank’s monthly report warned that Q4 growth could stagnate, but with only a slight risk of a prolonged recession. There are no major data releases scheduled for today. A lack of stats will leave the major German index in the hands of risk sentiment throughout the day. Geopolitics continues to be the key driver, with updates from the U.S and China on trade talks in focus.
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