#202427 - priceactiontds - weekly update - daxGood Day and I hope you are well.
dax cfd
Quote from last week:
comment: Sell vacuum theory was spot on. Bears printed 2 big good looking bars right to huge support and got no follow through. Bulls used it to trade back at least to the daily ema and 2/3 of the move. Huge price level around 18400/18450 with the ema. Bulls want above to test upper expanding triangle around 18600 and bears want a bigger second leg down to 17600. Both completely valid arguments and I will wait for a clear breakout before following.
comment: Market was completely neutral past week. Let’s look at the weekly chart and what it tells us. 5 Week selloff and now 2 bull weeks and past week was as neutral as it gets. Tells us that the market is in balance and does not know where it will go next. We can draw multiple bad bear trend lines and all are valid until broken. Does not help with trading at this price. Since we have a decent bull support line from the April and June low, we know that the market is in a triangle and the middle is most likely around 18300. As long as market is coming back to that price, you buy low and sell high. Since market is also staying above the weekly 20ema, bears are not favored to suddenly break below it. It’s also trading below the daily 20ema and did not have a daily close above it for 12 trading days. It’s a trading range near the ath, where the market is compressing and will soon see a breakout.
current market cycle: trading range - go look at the monthly chart. It’s a clear 4 month trading range. —unchanged
key levels: small range 17600 / 18500
bull case: Bulls want to break above 18500 to retest the other bear trend lines above.
Invalidation is below 18200.
bear case: Until bears can print consecutive bear bars below 18000, this market is still in BTFD mode and won’t go down further.
Invalidation is a 1h close above 18550.
outlook last week:
“ short term: Neutral again. Need to see a clear winner here at the daily 20ema for the next direction.“
→ Last Sunday we traded 18367 and now we are at 18417. High of the week was 18542 and the low was 18221 so my outlook was spot on.
short term: Can’t be anything but neutral again. Bears managed to stay below the daily 20ema but bulls bought the weekly 20ema. Trading range price action. Will get a breakout soon.
medium-long term: 17000 over the next 3-6 Months and when we get there, I update again. —unchanged
current swing trade: No big move caught. Will look for follow through selling on Monday and would swing a position then.
Chart update: Adjusted bear wave series to match the current sideways movement.
