dax daily outlook tues 17 may 2016 potential push down to retest minor range support at 978030 18116

(Click to enlarge charts) What happened earlier/yesterday The Germany 30 Index (proxy for the DAX futures) has continued to inch higher but remains below a […]

(Click to enlarge charts)

What happened earlier/yesterday

The Germany 30 Index (proxy for the DAX futures) has continued to inch higher but remains below a descending trendline resistance in place since 21 April 2016 high of 10527.

Key elements

The descending trendline resistance now stands at 10026/40 which are also the former swing high areas of 21/23/30 Mar 2016 and a Fibonacci cluster.
Since hitting a low of 9733 on 06 May 2016, the Index has appeared to be evolving within a minor range configuration with its support at 9780/30.
The hourly (short-term) Stochastic oscillator has reached an extreme overbought level which suggests limited upside potential at this juncture. These observations suggest a potential push down at least to the minor range bottom/support at 9780/30.

Key levels (1 to 3 days)

Pivot (key resistance): 10026/40

Support: 9780/30

Next resistance: 10165 (weekly pivot).

Conclusion

As long as the 10026/40 daily short-term pivotal resistance is not surpassed, the Index is likely to shape a potential push down to target the minor range bottom/support at 9780/30 in the first step.

On the flipside, a break above the 10026/40 pivotal resistance may negate the bearish tone to see a squeeze up to test the 10165 weekly pivotal resistance (click here for more details as per highlighted in our latest weekly technical outlook/strategy published yesterday).

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