- I see that we have a lot of support in this general vicinity, and I do think that it is probably only a matter of time before we see this market truly break out to the upside and perhaps go much higher.
- With that being said, the market is going to continue to be very noisy, but positive.
The German index continues to be one of my favorites, and the fact that we are breaking back above the €18,375 level does suggest that eventually we will break out to the upside. It’s probably worth noting that indices around the world have had a strong day, and I think at this point as the ECB host a major central bankers conference, it’s worth noting that traders are taking away from that situation a lot of positivity. If that’s going to be the case, then it’s our job to simply follow what the market thanks. At this point, I truly believe that the DAX will more likely than not continue to find its way higher.
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With that being the case, I think you get a situation where traders will continue to look at any dip offers an opportunity to find some type of value, and it’s worth noting that the €18,000 level underneath is a major support level. The €18,000 level of course is a significant large, round, psychologically significant figure, and an area that has already shown itself to be important in the past. With this being the case, it’s very likely that we will continue to see it defended quite stringently.
Technical Analysis
It’s probably worth noting that we just broke above significant resistance during the day, but we are also above the 50-Day EMA as well. At that point, the €18,750 level could be your short-term target. Keep in mind that the Americans will be away on Thursday, so liquidity could be a little thinner than usual, but obviously most of the liquidity comes from domestic or at least European trading houses. I remain bullish but I also recognize is going to be very noisy.
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