- The DAX continues to show signs of strength, as it looks like we are trying to break out.
- At this juncture, I believe the €15,000 level is going to be the next target and an area where you probably see a lot of noise.
- If we can break above the €15,000 level, then it opens a move to the €15,750 level. The market is a little overextended at this point, so it would not surprise me at all to see a little bit of a pullback.
In fact, the Monday candlestick was a shooting star, a typical selling signal for technical analysts. However, I’m not inclined to short this market, I am looking to buy little bits and pieces on dips because I do think that it is trying to go higher. Now, the consensus is that the market is going to go higher eventually, so I don’t have any interest in shorting, and I think that the 50-Day EMA hanging about the €14,000 level is something that should be paying close attention to as well.
DAX Continues to be a Leader in the European Union
All things being equal, the DAX continues to be a leader in the European Union, and during the day today, I am also featuring the CAC, as French stocks are following right along with German ones. The overstretched opinion that I have is a correlation between both Germany and France, which are by far the leaders in the European Union. So even if you are trading one of these indices, watch them both as they can give you a bit of a “heads up” as the rest of the smaller European indices will follow right along.
The Euro has strengthened during the same time, so at this point, it looks like most traders are trying to bank on the European Union economy taking off. There are still a lot of concerns out there, and it is possible that we get a major turnaround. As things stand on the charts though, there’s really nothing to suggest that quite yet, and we had the 50-Day EMA offering support in Germany just above the 200-Day EMA. In other words, there is a pocket of support in the general vicinity, so I must look at that as a potential floor in the market.
Ready to trade our DAX prediction? Here’s a list of some of the best CFD brokers to check out.