DAX Market Review, March 2019
DAX advanced in February ~2,9% and thus DAX has now gained from the start of the year almost +9%. The volatility is currently significantly lower, except for the two first weeks in February when we saw some rougher swings.
DAX advanced in February ~2,9% and thus DAX has now gained from the start of the year almost +9%. The volatility is currently significantly lower, except for the two first weeks in February when we saw some rougher swings. Also intraday, small dips have been almost instantly bought. These are all bullish signs, although we have severe resistance levels ahead and the bigger picture is still technically a bit ugly.
DAX has also climbed over the 6 months exponential moving average (EMA6) and on top of that, EMA6 is also advancing. The most interesting levels in March are 11300, which is the Pivot Point for March, 11770 which is Pivot Resistance 1 and 12000 which is Pivot Resistance 2 level.
On the weekly chart, which is the mid term trend, DAX is making higher highs and higher lows which makes the trend for the mid term bullish, althouhg DAX is still in a declining regression channel. Also on the daily chart, which is the short term trend, the trend is up. The Relative Strength Index (RSI) is a bit high on the daily chart and thus we should expect consolidation or pullback in the near term future. If DAX pulls back, 11400 is the first level of support. 11300 is a more important support level for the mid and longer term and it would be bearish if DAX started to trade below this level.
On the weekly chart, which is the mid term trend (chart below), DAX is still in a declining regression channel (blue and red channel on chart) but DAX the bearish mood has clearly lighten up and DAX has made “new highs” several weeks in a row. The area 11770 / 12000 is interesting for the mid term and most likely an more important resistance area.
When looking at the investor sentiment in the USA, bullish sentiment among the investors has made new highs at the same time when volatility in the SP500 index has been declining. SP500 has advanced over 20% since start of 2019 and consolidation or a pullback is to be expected also in the USA for the near term future. DAX usually follows SP500 bigger picture, which makes the investor sentiment in the USA also an important gauge for DAX.
The technical indicators summary for world futures is in strong buy -mode for the short term. Over the past weeks, the situation has changed and now, also mid-term is in bullish territory and for the longer term, there are now more technical indicators for indices flagging bullish conditions than bearish.
Indices performance from start of the year. In USA Small Cap has performed well and also strong gains in China CSI 300 and FTSE China A50.
March has historically been a bullish month for the DAX index.
The percentage of underlying instruments in the DAX index which are above or below its 20 day moving average (DMA20); more part of the instruments are above its DMA20 which is a bullish indication.
Also, the McClellan oscillator is still above the zero line, which is a bullish indication. However, there is a clear negative divergence emerging, which indicates that bullish momentum is declining and a pullback could be on its way.
Technical indicators summary of underlying instruments in the DAX index. On the short term, technical indicators are in strong buy -mode and even a bit “over bought” thus a consolidation is to be expected. The mid-term situation is still uncertain and the long term is still in strong sell-mode.
Summary of DAX underlying performance since start of the year.
Historically each week in March has performed well.
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