SDAX closes within previous day's range
SDAX Performance-Index (SDAX) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
SDAX finished the month 1.84% higher at 11747.77 after gaining €97.77 (0.84%) today. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (SDAX as at Jul 31, 2020):
Friday's trading range has been €207.74 (1.78%), that's above the last trading month's daily average range of €140.76. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SDAX.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar.
Prices are trading close to the key technical support level at 11653.29 (S1).
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 12068.13. The last time this happened on March 17th, SDAX actually lost -3.80% on the following trading day.
Although the index is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the nearby swing low at 11579.51 where further sell stops could get activated.
Among the two market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for SDAX. Out of 369 times, SDAX closed higher 56.37% 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 59.08% with an average market move of 0.61%.
With two out of the other three German Stock Indices closing lower today, the ones that stand out on the negative side are DAX losing -0.54% and MDAX closing -0.28% lower. On the flipside the best performer has been TECDAX closing 0.42% higher. Read more