Since our last Dax report on the 15th of April we have made some modest gains and are now respecting a Trend Support line, currently at 6733.5. If this continues to be the case we will soon be testing the 38.2 Fibonacci Retracement of the move down from the 27th of December. This line comes in at 6968 and a close above here is what we require before getting friendly towards this in the longer term. Confidence would increase greatly if we could eventually take out our high from the 19th of February at 7108. In the meantime we have to be cautious and watch our Trend Support.
Indicators in Play
Trend Support Lines are probably the most basic and easy to understand tools in Technical Analysis. Its just a matter of joining higher lows together with two and some prefer three points of contact. The more dips that touch the line and the longer the support has been in play increases the potency of this type of trading tool.
Summary
In the short term we will continue to buy dips to the Trend Support mentioned in our opening comment. However, there are still factors weighing on this market and until we manage a close above 6968 we remain cautious.
David has been
analyzing and trading the worlds financial markets for the past 25 years. After an initial grounding with Mercury Asset Management and Warburg Securities he went on to set up his own brokerage operation in London. Since then he has appeared regularly on Bloomberg Television and been involved in providing analytics on behalf of some of the worlds major exchanges. He is also a member of the Society of Technical Analysts.
Free Trading Education - Education for Trading Stocks, Futures, Forex,
Commodities and ETFs
ADVERTISING
Free Trading Education - Education for Trading Stocks, Futures, Forex,
Commodities and ETFs
