11-10-2017 Dax Technical Analysis

Hello traders and welcome to the 11-10-2017 Dax Technical Analysis.

Yesterday we failed to break the high from Monday and instead broke the lows and threatened the trend defining level of 12892. We reached a low of 12909 and ended up paring the majority of those losses to finish up the session back inside the opening range for the day. The price action intraday was a little unusual, as far as swings go. Because although the swings were fairly clearly defined, they were relatively directionless.

So trading started out with a bearish rhythm and there was a good sell call in the premium room around 9am. Price followed a fairly repetitive pattern; sell off, retrace, sell off, retrace, each time allowing traders to sell the rally. In fact it almost began to trend, until the early evening, perhaps 6:30pm, when a spike took price back up near to the daily highs.

Trend defining level remains at 12892

We remain on alert that we could be close to a major swing high (chart 1). On chart 2 we can see price action trading inside a narrow median line range (5% sliding parallel pair from the median line). Chart 3 shows the unusual price action for the day.

11-10-2017 Dax Outlook

Bulls

We remain above the trend defining level of 12892 and need to see strength to break through this level. The US indices are still continuing to race away, the NK threat is currently swept under the carpet and the world has not ended. We still have space to move into above, 13400 is not unrealistic as a longer-term target. A break above 13000 may slow price action down temporarily as traders take some profit at a key psychological level.

Range Traders

The last 4/5 days trading range is providing some stubborn support and resistance with a lot of buy and sell stops either side of the range. We have found a value area and we expect to see a wash of those highs and lows. Yesterday threatened a wash of the lows and whilst many stops were taken out, I believe there are more. Perhaps today we see a wash of the highs.

Just be aware that the price action is more ‘distribution’ than ‘clearly defined support and resistance’.

Bears

Yesterday was good progress towards starting a potential short position, with many opportunities to fade the current highs. We are seeing many median lines and upper median line parallels on forks across multiple frames, so this creates a strong case to sell. Chart 2 is an idea.

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11-10-2017 Dax Key Levels

KEY LEVELS
POC (Futures)12946
Value Area High (Futures)12962
Value Area Low (Futures)12932
14 Day ATR72.53
200 EMA12119
Daily R213024
Daily R112992
Daily Pivot12949
Daily S112917
Daily S212874
*Please be aware that FXCM can often be 5-10 points higher than futures prices

11-10-2017 Dax Technical Analysis Video

11-10-2017 Dax Charts

 

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