chart of the day dax back at range support for potential push up 2693972017

Short-term technical outlook on DAX (Fri, 23 Jun 2017) (Click to enlarge charts) What happened earlier/yesterday After it printed a new all-time of 12955 on […]

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By :  ,  Financial Analyst

Short-term technical outlook on DAX (Fri, 23 Jun 2017)

DAX (daily)_ 23 Jun 2017

DAX (4 hour)_ 23 Jun 2017(Click to enlarge charts)

What happened earlier/yesterday

After it printed a new all-time of 12955 on Tues 20 June, the Germany 30 Index (proxy for the DAX futures) had pull-backed by 1.9%  to hit a low of 12707 on 21 June. Thereafter, it traded in a tight sideway range between 12806 and 12716.

Key elements

  • The pull-back in price action from its 12955 high has led the Index to hover right above a key medium-term support of 12650 which is defined by a confluence of elements. The lower boundary of the medium-term bullish ascending channel in place since 09 November 2016 low, the shorter-term ascending trendline support from 18 April 2017 and close to the  23.6% Fibonacci retracement of the on-going uptrend from 18 April 2017 low to the12955 current all-time high (see daily & 4 hour charts).
  • The daily RSI oscillator has managed to hold above the correspond first support level of 50%. In addition, the short-term 4 hour Stochastic oscillator remains positive as it still has room to manoeuvre to the upside before it reaches an extreme overbought level.
  • The significant short-term resistance now stands at 12955/60 which is defined by the upper limit of range configuration in place since 18 May 2017 low and the 0.764 Fibonacci projection of the last up move from 15 June 2017 minor swing low to the 12955 high projected from the recent minor swing low of 21 June 2017 (see 4 hour chart).

Key Levels (1 to 3 days)

Intermediate support: 12750

Pivot (key support): 12650

Resistances: 12955/60

Next support: 12490/390


Therefore as long as the 12650 pivotal support holds, the Index may see a potential push up to target its range top/resistance at 12955/60 in the first step.

However, failure to hold the 12650 level is likely to invalidate the preferred short-term bullish bias to see another round of choppy decline towards the next support at 12490/390.

Charts are from City Index Advantage TraderPro


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