13, September 2016

DAX (a 4-hour chart)

General overview

DAX decreased when risk aversion returned to the market on expectations that the Fed may raise its rates in September.

Current situation

The index gapped lower at the open on Monday. The price jumped from 10460 to 10420. DAX weakened further during the Asian and European session. The instrument seems to have found a support at 10350 where it can pause after 3-day decrease. The index quotes gapped over the 200-EMA which acts as a resistance now. The 200-EMA extended its advance north, the 100-EMA is crossing the 50-EMA, both lines are turning down. The resistance is seen at 10520, the support lies at 10350.

MACD decreased which confirms the strength of sellers. RSI is in the oversold territory.

Trading recommendations

The overall picture is bearish. In the event that the sellers manage to force below 10350 the price may drop to 10175. DAX found a strong support at the level of 10350. We don’t exclude a larger bullish correction tomorrow. The price may recover towards 10520.