18, November 2016

DAX (a 4-hour chart)

General overview

European stocks traded higher focusing on Yellen's speech. The mining stocks added while the financial stocks were on the downside. South African Investec company jumped to 6-month high after its latest corporate earning report.

Current situation

The index gapped higher at the open on Thursday. Traders were unable to develop an upward trajectory which immediately faded after the gap. Prices turned lower and dropped to 10600 where they stayed before the North American session. The 50-EMA stopped the downward impetus rejecting prices upwards. The moving averages are neutral in the 4 hours chart. The resistance is seen at 10700, the support is at 10600.

MACD decreased which indicates the buyers’ positions weakening. The RSI oscillator moved downwards.

Trading recommendations

The DAX index will remain in bulls’ hands while the benchmark holds above 10600. Only a clear break below the level will ease the current bid sentiment. In this scenario sellers will lead prices to 10500. A failure to break the current support level will suggest an upward continuation towards 10800.