dax potential push up above 1012510069 support 1822982016

Daily Outlook, Tues 26 July 2016

(Click to enlarge charts)

What happened earlier/yesterday

The Germany 30 Index (proxy for the DAX futures) is now attempting to stage another challenge on the “Expanding Wedge” range top/resistance at 10180  in place since 21 April 2016 high after another “brief” bullish breakout seen yesterday (printed a high of 10265).

Please click on this link for more details on our latest weekly technical outlook/strategy published yesterday.

Key elements

• The key short-term support to watch now will be at 10069 which is defined by the minor swing low area of 22 July 2016 which also confluences with the pull-back support of the former short-term ascending range bullish breakout (depicted in dotted green) (see 4 & 1 hour charts).
• The hourly Stochastic oscillator appears to be oriented to the downside and it still has some room left to manoeuvre to the downside before reaching its extreme oversold level. These observations suggest that the Index may see a dip in price action at this juncture.
• The near-term resistance to watch will be at 10345 which is defined by the minor swing high area of 24 June 2016 which also confluences with a Fibonacci projection cluster.

Key levels (1 to 3 days)

Intermediate support: 10125

Pivot (key support): 10069

Resistance: 10345

Next support: 9980 (medium-term pivot)

Conclusion

Maintain bullish bias. Any potential dip in price action of the Index is likely to be held by the intermediate support of 10125 with a maximum limit set at the 10069 daily short-term pivotal support for a further push up to test the 10345 resistance in the first step.

However, failure to hold above the 10069 short-term pivotal support may negate the preferred bullish tone to open up scope for a deeper slide towards this week medium-term pivotal support set at 9980.

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