DAX Resistance Holds Around 13300 Mark

11 August 2020

DAX might be preparing to carve a lower high around 12700/800 levels after dropping from 13330 through 12250 levels respectively. The above drop might be retraced, before reversing lower towards 11600 and 10800 mark, going forward.

DAX probable wave counts are as follows. The indice had earlier dropped from 13800 through 8200 mark, sub dividing into 5 waves. This was an impulse drop marked as Wave (1) on the chart here. As discussed earlier, an impulse drop is usually followed by a corrective rally.

DAX had turned higher from sub 8200 levels since March 2020 and has managed to produce a zigzag corrective structure all through 13300 mark. This could be labelled as potential Wave (2) of a similar degree as the earlier drop.

If the above proposed structure holds well, DAX should ideally stay below 13300 mark and turn lower towards sub 8200 as Wave (3) begins to unfold. Also note that the indice had reached up to the fibonacci 0.88 level of the earlier drop before terminating potential Wave (2).

Ideally DAX should turn lower towards initial support around 11600 mark. It would then confirm that bears are in control and the indice is good to sell on rallies thereafter. The proposed termination for Wave (3) would be below 8000 mark in the next several weeks to come.

Traders might be willing to hold short positions taken earlier and also add more around 12800 mark, with protective stops around 13800 levels. The proposed targets would be 11600, 10800, 10000 and further. The indice remains bearish until below 13800 mark.

Trade with
Abans Global

• Authorised and Regulated by FCA
• Customer Support 24/5
• Low Spread & Commission
• Instant Execution
• No Dealing Desk