DAX: the German index returns to test a bearish slant

The DAX returns to test a bearish slant

From a technical analysis perspective, the DAX is returning to test a significant bearish slant at around 14,200 points below which it has retreated several times since the start of the year. A crossing of this slant would pave the way for a larger rebound in the DAX, up to the March peak at around 15,000 points, but would be insufficient to envisage the start of a new “bull market”. Indeed, given the background context described above, it will be preferable to wait for the 200-session moving average, currently at around 15,150 points, to be exceeded before starting to consider a new long-term uptrend.

In the event of a fall below this slant and a fall below the symbolic threshold at 14,000 points, it will be preferable to anticipate a new leg of decline in the DAX in the short term. A return to the May low of around 13,400 points and then to the March low of around 12,500 points would be expected.

Note the presence of the 7-period RSI in the overbought zone, which often marked the end of recent rebounds.

Entry: Sale below 14,000 points

Stop: 14,300 points

Objective: 13,400 points, then 12,500 points

Risk/reward ratio: >2

Follow the evolution of the DAX index with our CFD Germany 40.

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