Technical Update - DAX top and reversal pattern signals correction Technical Update - DAX top and reversal pattern signals correction Technical Update - DAX top and reversal pattern signals correction

Technical Update - DAX top and reversal pattern signals correction

Equities 2 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank Group

Summary:  DAX is in the process of forming an Evening Doji top and reversal pattern. A reversal that can take DAX down to 14,653 possibly 14,356


DAX hit 1.618 Projection at 15,222. Formed a Doji yesterday and opened with a gap this morning. A bearish day today will mean DAX has formed at top and reversal pattern, an evening Doji pattern.
RSI didn’t trade out its divergence – it needs to close above the horizontal dashed line to do so – and is now testing the 60 threshold. If closing back below more selling should be expected. This reversal has the potential to push DAX down to the 0.618 retracement at around 14,356 where the 55 daily SMA will provide support. However, there is support at around 14,653 where DAX could bounce from.
If buyers manage to resume power and close DAX above 15,270 the uptrend is likely to be extended to 15,560-15,610.

Source: Saxo Group

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