Market Video Overview: DAX 40 Futures
Tim Fairweather’s weekly report on the DAX 40 futures market.
DAX 40 report transcript
Hi everyone. And welcome back to another Brooks Trading Course weekend market report. My name’s Tim Fairweather. And today we’re going to go through the DAX 40 futures index. So last week was a small bull doji with a big tail above. You can see we just went up to test 19,000 again, and then went back down to the high of last week.
So last week was a good entry bar for a high one. We spoke about that last week. So it triggered those bulls and it gave them the absolute minimum they wanted, which was a bull bar and a close above the prior week. So they’re long. Uh, those bulls are in it to get to, they just got a new all time high, but they’re in it to get potentially the last leg of what I think is going to be a wedge top.
Uh, and it might be that this leg is going to be one, pause, two, pause, three. So I think we’ve had one leg, two leg, A couple of legs sideways. And then this third leg is going to be one, two, three up to what I think might be a wedge top, but that could be totally wrong. Of course, this, these four bull bars here are good enough to get a second leg.
And I don’t think this second leg at the moment is enough. The bears, what do they see? Well, the bears see that they’ve been getting sets of three bear bars, five bear bars. They’re able to create a lot of selling pressure around 19,000. And that’s a problem for the bulls, because what it means is if I’m a bull, why am I going to buy high when I’ve got a chance to buy lower around the moving average?
And you can see It was very difficult to lose money buying the moving average in the past couple of months. So even if the bears are able to get some follow through down here, I think that’s going to result in more buying. What are the bears need? Well, bulls are triggered in above the high of that bar.
Some bulls bought the absolute high there. They were triggered on. The buy above that bar at 19,000. So some bulls bought here, bought the moving average or bought lower, and they got out at 19,000 and that’s what we’re going to find out next week. Just how many of those bulls. are actually exiting versus how many new bulls are entering in.
I’ve got a two hour target because I thought if you bought above this bar here, it was the first bear close below the moving average, and generally that close is a reasonable setup for a buy, usually on a lower time frame. But then you’ve got a buy signal set up here, which had a great entry bar, great follow through.
If you waited for two bull bars, you had a great entry and follow through. And I think because it’s closed so high and got a new high, there’s no reason for those bulls to get out. Other bulls are looking at that as this is a trading range on the weekly chart. But we’ve tested 17, 000 a couple of times and gone away.
We spent a bit of time at 18, 000 and gone away. And so I think a lot of those bulls have decided that 18, 500, which is somewhere in there, to 19,000 is the range. What do the bears need? Well, they don’t have a sell signal for next week. So it’s not a great sell below there. I think there’ll be buyers at the moving average.
The bears really need, I think, to get a smaller wedge top here, some good bear bars, because at the moment, there’s a lot of bear bars that you can sell above and make money. And if you take every bear bar here, so you can see here, selling above bear bars anywhere between 18,500 and 19,000 has been profitable.
And so, this is creating this channel, and I think this channel is going to continue. Still always in long, and I think there’s going to be another leg, so sideways to up next week. Uh, potentially, sideways to the moving average. And that’s on the weekly chart. You can see here, the bears have been able to create a second entry short.
They’ve got a double top here, so they’ve got a sell signal which triggered here. And we’ve had one, pause, two, pause, three. Up here. And now we’ve got another sell signal here. So this is pretty interesting to see what’s going to happen here. This channel is tight. So I think on Monday, if it triggers, we’re going to go sideways, but there’s a chance that there’s going to be bears selling here, betting that they’re going to crash through the moving average and run the stops of any of these bulls, the board late, what they’ve got against them at the moment is when the bears sold.
We went above the highs here. We went to the moving average and there were just no, not enough bears there to push the market down. Any bears that sold there or who sold that gap got stuck and then bulls ran it up. And then that became a layer of support to move up. So I don’t think there’s any more bears stuck down here.
I think all the bears are going to be here and higher. And I think this is probably. A reasonable bear scalp attempt up here. So bears need a follow through bar. Well, they need a good entry bar if they’re going to take that short. So bears are selling basically a wedge bear flag, dueling lines. So three push pattern to a double top at 19,000, hoping to get back down to 18, five, probably just over one to one on that trade for the bulls.
Haven’t had a trend line break yet. So they’re pretty confident a buy here and a buy at the moving average would at least help them get out break even. We just went above 19,000 once. So we might have to go back above there again to see if there are any newer long term buyers. So still always in long for the bulls on the daily chart, but the first reasonable sell signal that’s appeared, it’s still sideways to up on the weekly chart.
But you can see with all this trading range price action, it’s been very rare that the market has just taken off And created open gaps and it’s been more common that the market has just gone sideways to down in a channel. You can see I’ve got some channel lines drawn where we’ve got a wedge bear flag here that failed.
Then we’ve got a wedge top that worked. We’ve got a wedge bottom that worked and now we’ve created a wedge top up here. So is the market going to continue to do what it’s been doing? Or is this going to fail and we’re going to go up that way? So the first reason we’ll sell signal for the bears on the daily chart But still in a high time frame bull trend and we’ll see if there’s more buyers or sellers at the moving average And I think we’re also going to go and test 19,000.
So that’s the analysis for last week on the German cash index. My name is Tim Fairweather and we’ll see you next week
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