Good morning traders!
A pretty boring trading day yesterday, trapped within a limited range, so I avoided the markets altogether. It’s not surprising that the market is pausing for breath given the activity from Thursday and Friday. The German IFO survey for October was released with expectations showing a modest improvement and so far, the slowdown in major emerging markets has done little harm to the German economy. Of course Germany takes great support from a weak Euro and the ECB asset purchasing programme provides exactly that.
Some analysts are believing parity will happen soon, but many are expecting between 1.02-1.05 by the end of the year. I may consider a short move.
Overall I am expecting either a pullback first and then a further rally or simply a break to the upside today from current levels. The daily pivot levels are compressed but I like the look of a reaction to the daily S1.[wp_ad_camp_1]
The daily chart does show that price has now closed above the 200 day EMA for the first time since August and has broken out through the Kumo cloud resistance to the upside. I think a good pullback zone form buying again would the 50% retracement from the most recent swing.
BoJ and FOMC still to come, watch out for reactions with USDJPY which is still working inside a compressing range.[twitter-follow username=”DaxTrader54″ scheme=”light”]
The Dax trades from Thursday/Friday are doing really well and are still on the books with a decent gain locked in.
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Dax Support & Resistance
|200 Day SMA||10631|