DAX 30 and CAC Charts – Macro-techs Continue to Worsen

DAX 30/ CAC Technical Highlights

  • DAX trading below HS neckline, moving towards 2011 trend-line
  • Gap below support has CAC at risk or more selling

For the intermediate-term fundamental and technical outlook for the DAX Euro, check out the Q4 Trading Forecasts.

DAX trading below HS neckline, moving towards 2011 trend-line

Today’s gap-down has the DAX trading below the neckline of the head-and-shoulders top under construction since June of last year. Given its sheer size a weekly close below the neckline is viewed as best for confirmation, and for now pressure is on the market to try and recover back above.

First up on any bounce from here is the neckline, a line of support now turned resistance. It could offer a nice spot from a risk/reward perspective for would-be shorts to initiate new positions, and those already in a short a threshold to use for managing their positions.

In the absence of a recovery above the neckline, the next major level arrives at the 2011 trend-line. This is viewed as effectively the last line of defense for big-picture longs as beyond the long-term trend-line there isn’t much preventing the market

Article source: https://www.dailyfx.com/forex/technical/home/analysis/ger30/2018/10/23/DAX-30-and-CAC-Charts-Macro-techs-Continue-to-Worsen-PRtech.html