Macro: Sandcastle economics
Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.
Access both platforms from your single Saxo account.
Technical Update - Correction likely to be unfolding in DAX/GER40 and EuroStoxx50/EU50
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
Summary: DAX/GER40 and EuroStoxx50/EU are indicating top and reversal scenario of 2-4%. Uptrend could resume after this likely minor correction
DAX/GER40 cfd Thursday 14the December buyers opened the Index much higher but couldn’t keep it up when sellers took control selling throughout the session forming a Bearish Engulfing candle (not the best textbook example though and could look like a Belt hold Marabozu which is also a top and reversal pattern) but with a close below minor support at 16,760 strong indications of a top and reversal was in place.
Monday morning buyers are trying to lift the Index back above 16,760 but are likely to be failing currently trading below the lower rising trendline.
A correction seems likely to be unfolding. A correction that potentially could take DAX down to the 03.82 retracement at round 16,096.
RSI has been in extreme overbought territory above 80 not seen in decades
Support around 16,528-16,469.
There is no divergence on RSI despite the extreme values indicating DAX could resume its uptrend after a minor correction.
If DAX is closing above 17,003 it will demolish the correction scenario and the uptrend is resuming with potential to 17,254.
EuroStoxx50/EU50 cfd A couple of days with indecisive trading where buyers and sellers have been fighting it out the Index has formed a couple of Doji candles – open and closing price with in few cents of each other.
That could be a sign of a top and reversal. If we see a day with a bearish candle without the peak at 4,593 is taken out a correction is likely to be unfolding
The divergence on the RSI is indicating an exhaustion of the bullish trend adding to the top and reversal scenario being played out.
A close below minor support at 4,523 and below the lower rising trendline could fuel a sell-off down to around 4,384-4,363
A close above 4,593 and the uptrend will resume with a likely to 4,684
Latest Market Insights
Quarterly Outlook 2024 Q3
Sandcastle economics
-
-
Bonds: What to do until inflation stabilises
Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.
-
Equities: Are we blowing bubbles again
Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.
-
FX: Risk-on currencies to surge against havens
Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.
-
Commodities: Energy and grains in focus as metals pause
Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)