Dax Technical Analysis 05/03/2015

Good morning traders!

ECB to release details on their asset purchase program, I suspect some investors may have been thinking about what types of assets the ECB would buy considering the poor returns they currently yield. But the fact remains that they are in the market to boost the balance sheet so you’d be forgiven for thinking that despite the recent pullback, the market will still want to move higher, especially with the 12 year lows on the Euro.

We had a corrective pullback on Tuesday and it began in the same way yesterday, but price was strongly rejected around 11200 and we are now way above the pivotal 11300 level. So is the pullback finished?

Potential issues today to affect the bullish sentiment will be the re-emergence of Greece and proposed changes to the asset purchase program.

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Support & Resistance

KEY LEVELSDifference
Daily R21156710
Daily R11148651
34 Hour EMA1135513
Daily Pivot11340-6
Value High11339-129
Naked VPOC11306-98
24hr VWAP11302-26
Daily S11125935
Value Low11223-90
Daily S211113-22
200 Day EMA9915-19

 

Dax Daily Chart Analysis

We thought a corrective move was about to continue, but 11200 held strongly and this is now key support. Price can be range bound between 11200 and 11450, but I still have to remain bullish overall.

Dax Daily Chart
Dax Daily Chart
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Dax Intra-day Chart Analysis (30 minute)

We broke out of the regression channel suggesting a corrective move, we bounced and are now testing the underside of the channel after briefly threatening to get back inside on the first attempt. Will we kiss the channel goodbye to the downside or get back to business as usual?

I’d be happy for a further correction to the black zone, otherwise I am happy to go long above recent highs on a break.

Dax Intra-day Chart (30 minute)
Dax Intra-day Chart (30 minute)
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Dax Intra-day Chart Analysis (1 minute)

For the second day in a row, we failed to take out the daily R1 on the pivot indicator, but have breached the S1. Buying zones could be the daily pivot, 11300 or the daily S1. If you are bearish then current levels could be a good spot, otherwise 11450 or the R1, but watch for volatility with the ECB release.

Dax Intra-day Chart (1 minute)
Dax Intra-day Chart (1 minute)
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Dax Volume Profile Chart Analysis (5 minute)

Two unusual profiles back to back and two very volatile trading days with a 250 point swing. We are currently extended up by the deviation high and quite a way above the rolling 24 hour vwap and even the rolling weekly vwap. Based on the composite 5 day profile, there is space to fall into on the way down to the 11339 value area high, if we take that out then we will probably test the naked vpoc.

Dax Volume Profile Chart (5 minute)
Dax Volume Profile Chart (5 minute)
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Interesting Chart from the New Indicator – SPX

This follows on from the article which can be found by clicking on this sentence.

I have spotted a potential setup beginning to form on the daily chart for SPX. But the fundamentals may not work with this one. The technicals say that the trend is bullish (the moving average line is green), the RSI-like oscillator is below 30, but red (needs to be green) and the price is approaching the green lines. A potential trade could be to target the blue line with a stop under the second green line of the channel. But the fundamentals may not work with this setup. Monetary policy dominates here, but there is certainly potential for a trade.

Interesting Chart on New Indicator
Interesting Chart on New Indicator
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