05, July 2016

Dax (a 4-hour chart)

Dax (a 4-hour chart)

General overview

There was a low volatile trading at the European Bonds Market due to the Independence Day celebration in the USA. The European stocks traded in the red zone after a four-day rally, as the decline in shares of the Italian banks eliminated the growth in price of the mining companies securities. The weak statistics in the EU and the UK pressured the indices as well. In addition, the European automobile producers lost some positions: Fiat Chrysler shares became cheaper by 4.0%, Porsche by 3.1%, Renault and Peugeot by 2.9%.

Current situation

The index decreased from the recently sent highs at 9800. DAX30 returned below the level of 9760 and ended the day close to the mark of 9700. The resistance comes at 9760, the support exists at 9550.

The indicators (MACD and RSI) remained in a green zone. MACD slightly decreased, RSI moved from the overbought level. The staying in a green zone is a good supporting factor for the buyers. The price returned below the 50-day moving average. The 100-day moving average is a resistance for the index. The moving averages direction is downwards.

Trading recommendations

The index now seems to be heading towards its immediate support near 9550. We feel comfortable taking short-term short positions. Alternatively, there will be a break above 9760 and a growth towards 9870.