Dax Market analysis, July 2019

Dax Market analysis, July 2019

08 July 2019

Investors were bullish in June - bulls gained back the decline we saw during May. Also July has started with a positive tone and while writing this analysis, DAX has already gained +1,5% in four days. The trade tensions between the USA and China and comments from FED has provided the markets with volatility lately. News has lately been supporting the market but it is also likely, that we will see volatile reactions when more details about the trade agreements emerge.

On the monthly DAX chart, the moving average EMA6 has crossed EMA12 from below and this should be taken as a bullish sign. Technically the market situation is more bullish than bearish but currently, the best estimate is that going forward 1-2 months, DAX keeps trading in a bigger range. Historically, July has been a tad more positive than negative but also keep in mind, that historically June is a weak month and this year DAX performed very good during June. If DAX starts trading below 12150, this should be seen as a cautious sign and possible trend change.

Long term trend support levels: 12150, 12000, 11800
Long term trend resistance levels: 12980, 13250

Below weekly chart with pivot points for July. The monthly Pivot R1 is also a Pivot Resistance level for the year 2019 and thus this is a more significant resistance level. From a technical perspective, the most likely scenario is that we trade the upcoming 1-2 weeks in a range where upper range is 12750 and lower is 12330. The monthly Pivot Point is at 12150 and should be defended by bulls for a continuation in the 2019 up trend.

When looking at the investors sentiment in USA, we are in neutral territory. Also the S&P 500 volatility has declined lately which is a positive sign.

July has historically been slightly positive month for the DAX.

The percentage of underlying instruments in the DAX index which are above or below its 20 day moving average (DMA20). This is a bullish sign and indicates, that no bigger decline is luring behind the corner during the upcoming 1-2 weeks.

The McClellan oscillator is in bullish zone, nor does this gauge indicate bigger declines in the near future. Usually bigger declines emerge when the oscillator is below 0 or when a negative divergence is building.

Technical indicators summary of underlying instruments in the DAX index. Short term the indicators are in strong buy when longer term is mixed plate.

Summary of DAX underlying performance since start of the year

 

Historical median return is positive for all weeks in July.

 

The worlds largest indices 1 month performance.

 

Also the summary of technical indicators are in bullish mode. Only the shorter term (1-3 days) are flagging some weakness.

Note: Please note with respect to the information provided above that past performance of a financial instrument is not necessarily indicative of the future performance of that financial instrument.
13/11/2019 19:03:27

 

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