Global stock indices retain and reinforce bull theme (DAX forecast)

Intermediate
  • A firm rally by global stock indices on Wednesday, to build on this week’s advance and the late June-early July surge higher.
  • This has sustained the more bullish threat we highlighted last week as stock indices have resolved the June consolidation theme in to a more bullish view.
  • The “risk on” bias has been assisted over the past 48 hours by positive tests from Oxford University and Moderna for a COVID-19 vaccine.
  • Here we look at the German benchmark share average future, our DAX forecast for today and into the second half of July.

DAX day trade outlook: Bull theme

Day trade update and view

A bull gap into Wednesday (12791-782, subsequently closed), to overcome various resistances, including the cycle peak at 12934, up to 12989, to build on Tuesday’s rebound from within our 12520/509 support area, from 12515, to keep the risks to the upside for Thursday.

Day trade setup

  • We see an upside bias for 12938.5 and the new cycle peak at 12989 and then 13000; a break here aims for February swing resistance at 13158.5 and 13250.
  • But below 12758 opens risk down to 12612; a break here targets 12515/509, possibly 12384.5.

DAX intermediate-term outlook

The late May rally above 11417.5 signalled an intermediate-term shift from a bear trend to a broad, neutral range and the acceleration above the 12275.5 swing peak from early March, sets an intermediate-term bull trend.

  • Upside risks: We see an intermediate-term bull trend and risk for 13824 and 15000.
  • What changes this? Below 11589.5 shifts the intermediate-term bull trend straight to an intermediate-term bear trend.
6 Hour DAX Chart
6 Hour DAX Chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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