Technical Update - Closing gaps but DAX and GER40 are facing strong resistance Technical Update - Closing gaps but DAX and GER40 are facing strong resistance Technical Update - Closing gaps but DAX and GER40 are facing strong resistance

Technical Update - Closing gaps but DAX and GER40 are facing strong resistance

Equity 2 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

DAX closed the gap once again but is facing strong resistance. Bear trend can soon resume. GER40 inches away from key resistance

 



With the forming of a Bullish Engulfing pattern last week indications of a possible bottom and reversal was there. However, DAX didn’t seem to be able to keep the upside momentum with the Index sliding back below the gap. But that changed yesterday. Helped by heavy buying in US equities DAX closed the gap from last week and is back now back above the gap.  

Next key resistance for DAX is 12,674. If DAX fails to close above that level the Index is likely to resume down trend.
If DAX manages to close above 12,674 there is strong resistance around the 0.618 retracement of the September downtrend at around 12,915. 55 daily SMA is coming down indicating underlying bearish sentiment and will provide resistance

 

Source for all charts and data in this article: Saxo Group

The GER40 cfd/DAX future dipped below key support at 16,707 bouncing back above the 0.618 retracement of the 2020 trough to September 2021 peak.
To build on the rebound momentum GER40 needs to break above 12,690 for further upside momentum. If it manages to do that there is strong resistance at around 12,897-12,938.
If the future slides back below Thursday low at 11,933 bear trend is to resume and last week’s low at 11,808 is likely to be taken out.

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 is not intended to and does not change or expand on this. 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/legal/disclaimer/saxo-disclaimer)
- Full disclaimer (https://www.home.saxo/en-mena/legal/disclaimer/saxo-disclaimer)


Boulevard Plaza, Tower 1, 30th floor, office 3002
Downtown, P.O. Box 33641 Dubai, UAE

Contact Saxo

Select region

UAE
UAE

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.