New major lows have been reached and although we did not close below 9,000 yesterday we seem to want to continue lower.
The break below support, which was becoming a strong level, has opened up the potential support cum resistance trade and I am looking out for that.
Right now I am personally looking for selling opportunities only when the market is like this, so I won’t be going long to reach the 9200 handle. We touched support from August 8 2014 this morning and bounced from there, closing the gap which opened at 7am, as I type this article we have just reach 9043 and turned lower again.
If the current swing on the daily chart is going to extend 100% from the early 2016 swing, then targets are around 8300 and that’s definitely possible if we take out and hold below the August 2014 low because there is not a lot of support below there. The .618 extension is 8922 and the August low is 8902.
There is a lot of volatility at the moment, so short term traders are going to find conditions quite tricky as 20-30 point swings can happen within seconds and the larger leveraged positions can put a lot of strain on margin. So trade carefully.
I have a sell order at 9200 still, but I may also consider a sell order around 9050 as the 9075 level was difficult to break down yesterday.
Dax Support & Resistance
|200 Day EMA||10435|