DAX closes higher for the 2nd day in a row
DAX Performance-Index (DAX) Technical Analysis Report for May 25, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DAX ended Monday at 11391.28 gaining €317.41 (2.87%). Today's close at 11391.28 marks the highest recorded closing price since March 6th. The bulls were in full control today, moving the market higher throughout the whole session. Ending with a strong close near the high of the day sets a bullish note for the next session.
Daily Candlestick Chart (DAX as at May 25, 2020):
Monday's trading range has been €273.16 (2.44%), that's above the last trading month's daily average range of €227.84. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DAX.
Two candlestick patterns are matching today's price action, the Bullish Closing Marubozu and the White Candle which are both known as bullish patterns. The last time a White Candle showed up on May 22nd, DAX gained 2.87% on the following trading day.
Crossing above the upper Bollinger Band for the first time since January 9th, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 10838.48 or signal the beginning of a strong momentum breakout leading to even higher prices.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Up Move" stand out. Its common bullish interpretation has been confirmed for DAX. Out of 361 times, DAX closed higher 53.46% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 59.83% with an average market move of 0.49%.
With four out of the other four Major European Indices closing higher today, the ones that stand out on the positive side are TECDAX gaining 2.17% and CAC closing 2.15% higher. None of the markets ended the day in the red. Read more