No more ranting today.
Are we looking at having a bit of a short squeeze (in the short-term), or are we going to find the resistance and continue our decline towards 9000. You would expect the latter, given the fundamental outlook, but we are still 1000 points down from Thursday, without any significant retracement. Bulls are clinging to hope of this thought believing that the Brexit hype has played ut already and we have seen the lows. That’s it. I am a bull naturally, so I would love to believe this, but I do not buy that story. Not even nearly.
Longer term, it’s difficult to be a bull at the moment and the bears are clearly in control. For those who are not already short, finding good risk:reward opportunities at current levels is tricky so orders are likely being placed around 9750. We are biased heavily to the downside, with many bounces on the way down.
On the 5-minute chart, we broke above channel resistance, first thing this morning, and at the time of writing this (11:00) we are threatening to re-test the 9500 from the underside. The first attempt to break it, earlier this morning. We have daily support at 9435 and a break below this will open up a move down to the daily pivot and lower. A break above 9500 opens the door, to 9750 which is the 50% retracement of the 1000 point drop on Friday and close to the daily R2.
I am looking to set up my RSI software to a bearish template, something like: 60 20 levels 14 periods, 1 hour chart.
I am currently short at 9455, SL9500 targetting 9380.
Dax Support & Resistance
|200 Day EMA||10096|