The DAX is at a very interesting area.
Weekly Timeframe: The weekly timeframe shows that the German index is seeing relatively aggressive selling at the moment. The last session saw the market push below 9790, a weekly swap level. Is there a chance that we may see further selling down towards a weekly decision-point demand area at 9126-9467?
Daily Timeframe: Friday saw the market break above a daily resistance zone at 10048-10007, and coupled with Monday’s trading session, a two-bar reversal pattern printed, essentially forming the beginnings of a fakeout. From there on, follow-through selling was seen resulting in prices closing below the aforementioned weekly swap level. In our opinion, this move has potentially cleared the path south for prices to test 9682, a daily swap level. Let’s see what the 4hr timeframe shows.
4hr Timeframe: There was clearly too much selling power around 9893 for the buyers to contend with yesterday, as a rather aggressive sell off was seen down towards a 4hr demand area coming in at 9683-9735 where the market closed for the day.
That being the case, for further selling to be seen on the DAX as both the weekly and daily timeframes are indicating, this 4hr demand area will need to be consumed. Assuming that this happens today, or even tomorrow, we see a clear run down towards a daily decision-point demand area coming in at 9381-9524 (circled in red). This would give us ample reward to our risk if we shorted a retest down to here.
Current buy/sell levels:
• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).
Daily Timeframe: Friday saw the market break above a daily resistance zone at 10048-10007, and coupled with Monday’s trading session, a two-bar reversal pattern printed, essentially forming the beginnings of a fakeout. From there on, follow-through selling was seen resulting in prices closing below the aforementioned weekly swap level. In our opinion, this move has potentially cleared the path south for prices to test 9682, a daily swap level. Let’s see what the 4hr timeframe shows.
4hr Timeframe: There was clearly too much selling power around 9893 for the buyers to contend with yesterday, as a rather aggressive sell off was seen down towards a 4hr demand area coming in at 9683-9735 where the market closed for the day.
That being the case, for further selling to be seen on the DAX as both the weekly and daily timeframes are indicating, this 4hr demand area will need to be consumed. Assuming that this happens today, or even tomorrow, we see a clear run down towards a daily decision-point demand area coming in at 9381-9524 (circled in red). This would give us ample reward to our risk if we shorted a retest down to here.
Current buy/sell levels:
• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).
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