Market Technical View is a blog that mostly concerns the technical analysis of different financial instruments like indices, commodities, stocks, ETFs and currencies.

All the posts are structured in 3 main chapters that can be found in Content, in the upper right-hand corner of the blog.

Market perspective. The technical approach consists of chart patterns and important support/resistance zones. The purpose of this section is to give directions of the price on short and medium term (a few days up to a few months).

Trading setups. The analysis posted here will provide trading scenarios based on different technical tools.

Romanian Market. This is a section dedicated to Romanian stocks and indices.

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Monday, October 10, 2011

DAX Technical Analysis 2011.10.10

Rally is losing power

On the intraday chart (15min) of DAX we can spot a few signals of weakness in the up move we have witnessed last week:
  1. T1 trend line was broken and retested - this price pattern is often formed at local tops/bottoms.
  2. 5,750 resistance level was tested twice and the sellers overcame the buyers. The rally seems to lose its power.
  3. Bearish divergence on RSI that usually forms at the end of an up-swing.   

In case of a further down move, the target zone is set between the 38.2 and 50% retracement (5,440-5,510).

On the 4 hour chart (below) DAX index has clearly formed a strong base that can lead to a longer rally in the next weeks. The main target for this possible rally is the 50% retracement area in the 6,340 zone. According to Elliott Wave theory, wave 2 (which is in progress) will develop in three ([a]-[b]-[c]) sub-waves.

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