Market Overview: DAX 40 Futures
DAX futures went higher last month with a bull outside bar in a bull channel. It was in breakout mode in a tight trading range for several months, and now we are just at 19000 Big Round Number. Stop-entry bulls are making money, so we should go higher. But the bear scalpers did very well selling above the inside bar, so it is more likely to go sideways to up rather than a new breakout.
DAX 40 Futures
The Monthly DAX chart
- The DAX 40 futures went higher last month with a bull outside bar closing on its high so that we might gap up on Monday.
- 19000 is a Big Round Number, and the market made a few attempts to reach it, and it looks like we will on Monday.
- The bulls see a bull channel, and the last leg now has three pushes. The bulls see the breakout mode overlap as the two legs move sideways.
- Bulls have open breakout gaps below, and that’s good for a bigger upside.
- However, bears were able to make a good scalp selling above the inside bar, so they will likely try again.
- Outside bars have a lower hit rate than regular bull bars for stop entries. Since this is a trading range on a lower time frame, we will likely continue to go sideways to up.
- If the bulls can get a strong breakout follow-through bar, that would be a strong upside surprise.
- The bulls also have the first H1 buy, as the prior bull bars didn’t trigger.
- Other bulls will wait for it to trigger and try to buy the test back to it.
- Always in long, so traders should be long or flat and wait for good stop entries.
- Bears don’t have a signal bar, so shorting is not yet a high-probability trade.
- Expect sideways to up next month.
The Weekly DAX chart
- The DAX 40 futures went higher last week with a strong bull bar in a bull spike.
- The bar closed on its high, so we might gap up on Monday.
- It is the fourth bull bar in a row, so it is also a bull microchannel.
- In a microchannel, a buy signal is the first time we go below the low of a prior bar.
- The bulls have many open microgaps, so traders expect a second leg sideways to up.
- The bulls have a 2r target above and are right at 19000.
- Can you buy here? Well, it’s always in long and good bull bars in a bull channel, but there were a lot of overlapping bars to the left, so you should be able to scale in lower as well.
- It is far above the MA, so some bulls will look to exit at the first sign of sideways movement, expecting a channel and not another strong bull breakout.
- Bears sold and made money but got out below the MA and have had no signal bar.
- It is always in long, so traders should be long or flat and expect sideways to up next week.
- There have been many climactic bars, which is a sign of a trading range. In a trading range, the trend is most bearish at the bottom and most bullish at the top.
- Bulls have some 1R targets above, and those bulls should get it. They need new bulls to buy up here, but the stop is far away.
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