Market Overview: DAX 40 Futures
DAX futures went higher last week going always in long. We will likely pull back here. There was strong buying as bears scaled into their bear spike and are now holding losing positions. The pain trade will be up if the bears can’t get it to move down in the next couple of weeks. The daily is a bull microchannel, so the only sales would be profit-taking, if at all. High in a trading range at a clear target so we might pause here. The surprise would be a strong breakout up.
DAX 40 Futures
The Weekly DAX chart
- The DAX 40 futures market went always in long last week. The bulls got their consecutive bull bars above the moving average.
- Let’s start with the higher time frame. On the Monthly chart. There is no High 1 buy above this price, so they need new bulls to go higher.
- The monthly chart also lets out any BTC bulls who bought and scaled in lower.
- On this chart, there are two remaining stop-order bull targets. What does that mean? If a bull buys above a reasonable bull bar in an always-in-long market, they should be able to get let out.
- Watching these prices helps you understand if new bulls are entering or if they are taking profits on their scale-ins and breakevens on their first positions.
- Bears sold this price several times and made good money. Will they do it again? Probably. Selling above strong bear bears for a scalp is a reasonable trade above the MA in a trading range.
- Because of the agreement at 18500, I would not be looking to take a stop-entry on this chart. I want to see a clear breakout and some sort of a pullback.
- Bulls want to trap any limit-order bears up here.
- But if a bull bought the weekly buy signal, they made 1:1. They got a good close on the follow-through bar and could still be long for a 2:1.
- If we pull back strongly, then they would take the 1:1.
- Some bears will have faded the breakout point, the MA and will be betting we are going to overlap all these prices and I agree with them right now.
- The Bulls’ reversal and follow-through were strong, so it is likely they will get a second leg.
- I’m always in long, but I’m expecting a pullback this week. Three bull bars in a row is all you get, usually in a trading range.
The Daily DAX chart
- The DAX 40 futures market went higher on Friday with a strong bull bar with a small tail above.
- The big bull breakout and FT across the MA got it MM target on Friday to the tick.
- The tails above show us a channel is forming. This might be the end of the spike, and the market might have to test the start of the channel.
- Bulls closed the gap from the last bear spike and tested the high of the last sell climax, which was the logical target.
- Bears tried twice to reverse down but failed to trigger either of the bars.
- Bears see a breakout above an inside bar which we probably need to go and test.
- Was it a reset with the BO above the MA? Maybe. I think we are in the third leg now which is enough to get out in a trading range.
- The bears expected 18000 to be resistance. But it failed, and the market printed five consecutive strong bull bars, closing on their highs with gaps.
- We could start to go sideways here for a few bars, and the bulls want a measured move up to 19000.
- The stop is far away for the bulls, and it’s a bull microchannel, so where is your higher low? You don’t have it yet. It is a big open risk and high in a trading range, so profit-taking is likely.
- I think the MA will act as support now, so if we pull back into the tight trading range of the last few bear bars, that will be the best the bears get.
- The weekly needs a second leg up, but that can take a few weeks, so sideways is likely looking left.
- It’s always in long, so I’m expecting sideways to up next week.
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