As the legendary analyst/trader Mr Richard Demille Wyckoff once said, “Everything that market did today must be compared with what it did before”. This always come to my mind when I look at a chart and start my analysis. I have marked two rallies in Blue which may be cross referenced using the teachings of this legend. We should know what to look for. Change in behaviour. Can we see it ?
With above in mind, lets kick off our DAX analysis. DAX has now reached to a significant zone of resistance. Position where the current rally comes to a stop, over the coming days, would give us further insights as to what may unfold from here on.
RSI has once again is in a bull mode. Divergence was one of the clues for the current rally. Those breakdowns or marginal new lows or shakeouts or springs or bear traps fact of analysis I guess which we all learn.
Euro is also worth watching from here on. Any breakdown in Euro, which may occur out of the congestion that it is currently in may well add further fuel to DAX. Watch this space when most analysts become overly bullish with Euro some not realising the position in the big trend !
My view is that global markets are likely remain congested/flat/range bound for a considerable period, months perhaps, within their major uptrends.
Analysis continues at my end….
Chart is courtesy of tradingview.com
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