Market Overview: DAX 40 Futures
DAX futures went higher last week, with bull bars above the MA again in a bull channel. After a miss earlier, it looks like 19000 is the target again. Bears needed to do more below the MA but failed. Sideways to up is more likely in a channelling style.
DAX 40 Futures
The Weekly DAX chart
- The DAX 40 futures went higher last week, with a bull bar closing near its high.
- it is the fourth consecutive bull bar above the moving average which is sloping up.
- So it is a buy signal for next week.
- The bars are mostly overlapping, so there is more channelling behaviour, so traders might buy in the buy zone of the bar instead of above its high on Monday.
- It follows five bear bars. Big up, big down, so trading range likely.
- The bulls saw trend resumption attempts, and the first touch of the MA was likely to be bought.
- The bears scared them with their strong move to the MA. But after the inside bar (weak follow-through), it was buy and buy below.
- The bears tried to sell above daily bars all week and get a second leg down but kept failing.
- The bears will try again, but it might be closer to 19000. The bulls triggered a High 1, a buy above the bull bar just under 19000 and I said a few weeks ago we would likely get back here.
- High 1s in bull trends are reliable signals to trade back towards.
- Because the bulls made a new high, the bears need a double top or lower high to cause a reversal.
- For now, it’s a bull channel and always in long, so sideways to up expected next week. Better to be long or flat.
The Daily DAX chart
- The DAX 40 futures went higher with an always in long pullback and a second leg up.
- The bulls got above the high of the last bears’ sell climax, and now, a measured move up to 19000 is more likely.
- Strong breakout bar above prior highs, so we might pull back on Monday back to the breakout point.
- Bears did well on Tuesday to run the price all the way down to their trapped bear friends who sold the MA.
- But it was clearly a weak sell down after going always in long.
- Three bull bars are now closing above the MA, so buy and buy below for a test of the highs. I think we need to hit High 1 on the weekly bar.
- Can bears sell here for a trading range? The risk-reward is good, but the probability is too low.
- It’s a weak limit order sell and no sell signal, so it’s better to be long or flat.
- The bulls got stuck up here before, so some might close that part of their positions, but most will run it, I think.
- Bulls now have bars with no overlap and gaps, so higher prices are likely.
- Can bears argue many legs? It has channelling behaviour, and breakout points overlap, but bear bars do not get triggered, which means fewer stop-order bears are in the market.
- I think limit order bears that sold the doji will get out when we test back down and become bulls as well. That is common in a TR environment and you can join with them and buy.
- Expect sideways to up next week.
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