DAX dominated by bears dragging the market lower throughout the day
DAX Performance-Index (DAX) Technical Analysis Report for Jun 11, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, DAX finished Thursday at 11970.29 tanking €559.87 (-4.47%). This is the biggest single-day loss in over three months. The bears were in full control today, moving the market lower throughout the whole session. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (DAX as at Jun 11, 2020):
Thursday's trading range has been €331.66 (2.71%), that's above the last trading month's daily average range of €255.92. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for DAX.
Two candlestick patterns are matching today's price action, the Bearish Closing Marubozu and the Black Candle which are both known as bearish patterns.
The stock index closed back below the 200-day moving average at 12138.06 for the first time since June 2nd. When this moving average was crossed below the last time on February 27th, DAX lost -3.86% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) below 20" stand out. Its common bullish interpretation has been confirmed for DAX. Out of 253 times, DAX closed higher 58.50% 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 61.66% with an average market move of 0.76%.
With five out of the other five Major European Indices closing lower today, the ones that stand out on the negative side are BEL20 losing -4.97% and CAC closing -4.71% lower. None of the markets managed to end the day in the green. Read more