Technical Update - Choppy DAX likely to test July low and key support
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
DAX is choppy between 13K and 12.600. Seems to be a tug of war between buyers and sellers. However, RSI is below 40 with no divergence indicating the sellers are likely to win this battle which is likely to push DAX to test the July lows at around 12.390. From there we are likely to see a little bounce. A close below will confirm the down trend and push the RSI on the weekly time period below its rising trend line it is currently testing.
If that scenario plays out there is not strong support on DAX before around 11,580, close to the 0.618 retracement of the 2020 trough to 2021 peak.
For DAX to reverse the short-term down trend a daily close above 13,375 is needed but to reverse the medium- to longer term picture DAX needs to close above 13,948
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