DAX resistance in the testThe German benchmark index is currently flirting with a possible continuation of the primary upward trend. However, in view of the negative seasonality and cyclicality from August onwards, the trees should not grow into the sky.
The DAX has not yet been able to make a decision about the direction in which it will leave the established trading range of several weeks. The bulls are currently attacking the upper limit of the range again. Intraday, the record high of June 14th at 15,803 points was slightly surpassed in each of the past three trading days. However, the exemption in the sense of a daily closing price was still missing.
What are the possible goals?
After the formally completed abc correction, we still favor exhausting the remaining potential on the upside, which results from the still active price targets at currently 15,925-16,000 points, 16,111 points and (maximum) 16,187 points. However, the seasonal window of opportunity with a tailwind is slowly starting to close. Headwinds for the bulls can be expected from the beginning of August. In addition, the typical cyclical pattern before the federal election also acts as a burden.
Period of weakness ante portas
We consider the likelihood of a multi-month high and subsequent establishment of a medium-term downward trend in the event of an advance to the target areas mentioned to be high, also in view of the market situation that is already clearly overbought. In purely seasonal and cyclical terms, the chance for a significant low in September / October would then be good. We currently see relevant supports at 15,700 points, 15,632 points and 15,304 points. Below that, a bearish signal would result in the direction of 14,816-14,961 points.
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