Technical Update - EuroStoxx50 and DAX rejected at key resistances but indicators not agreeing on direction Technical Update - EuroStoxx50 and DAX rejected at key resistances but indicators not agreeing on direction Technical Update - EuroStoxx50 and DAX rejected at key resistances but indicators not agreeing on direction

Technical Update - EuroStoxx50 and DAX rejected at key resistances but indicators not agreeing on direction

Equities 2 minutes to read
Kim Cramer Larsson

Technical Analyst, Saxo Bank Group

  • The RSI indicators for the EuroStoxx 50/EU50 CFD and DAX/GER40 CFD are showing divergent trends, which presents a mixed signal in the broader market context
  • For EuroStoxx 50, the RSI is pointing to lower Index levels where as the RSI on DAX are suggesting the index could push to new highs

EuroStoxx 50
is testing key strong support at around 4,888. A daily close below this level is likely to lead to a sell-off down to the gap and strong support area between 4,812 and 4,775.

The strength indicator RSI is still showing positive sentiment, but divergence has been indicating trend exhaustion for several weeks now.

A daily close on the RSI below 40 will confirm the bearish for Eurostoxx50.
A daily close above the key resistance at 5,035 is needed for the index to resume its bullish trend

Source all charts and data: Saxo Group
EU50 CFD levels indicate strong resistance at 5,035, support at 4,849, minor support at 4,810, and strong support between 4,742 and 4,670

DAX was rejected for the fourth time at the strong resistance at 18,192 and could slide lower to test key strong support around 17,620.

However, the strength indicator RSI is still showing positive sentiment with no divergence, indicating higher DAX levels are in the cards. But a daily close above 18,192 is needed for that bullish sceanrio to play out

A daily close below 17,620 is likely to push DAX lower to support and gap area between 17,326 and 17,118.

GER40 CFD levels: Support at 17,612, minor support at 17,395, strong support at 17,154 and 16,778. Resistance is at 18,236.


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