DAX closes above its opening price after recovering from early selling pressure
DAX Performance-Index (DAX) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DAX ended Wednesday at 13255.37 gaining €37.70 (0.29%). Today's close at 13255.37 marks the highest recorded closing price since February 21st. Trading up to €42.60 lower after the open, the index managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (DAX as at Sep 16, 2020):
Wednesday's trading range has been €95.67 (0.72%), that's far below the last trading month's daily average range of €213.94. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DAX. Prices continued to consolidate within a tight trading range between 13117.46 and 13339.14 where it has been caught now for the whole last trading week.
Prices are trading close to the key technical resistance level at 13339.14 (R1). After having been unable to move above 13262.81 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 13277.23. The last time this happened on September 8th, DAX actually gained 2.07% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 13339.14 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 13138.20 where further sell stops might get activated. As prices are trading close to September's high at 13460.46, upside momentum could speed up should the stock index mark new highs for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bullish Intraday Reversal" stand out. Its common bullish interpretation has been confirmed for DAX. Out of 465 times, DAX closed higher 55.70% 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 eight trading days, showing a win rate of 59.57% with an average market move of 0.23%.
With four out of the other five Major European Indices closing higher today, the ones that stand out on the positive side are BEL20 gaining 0.88% and TECDAX closing 0.79% higher. On the flipside the worst performer has been FTSE closing -0.44% lower. Read more