DAX is retesting the broken consolidation triangle
What is happening with the DAX? We are seeing the MONTHLY November pullback from the strong downside resistance zone 11250-11500. Does this mean that the DAX will go for 13000 again? Should you be building the buying position…If we look at the monthly chart we can see a huge reversal month happening in November but so far this is just a consolidation pullback, and we need to see a break above 13100 to call this an uptrend extension.
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The only thing that we can’t rule out is a violent price action after the November US election, so consolidation around 13000-13100 is not excluded and this is exactly the strong resistance zone for an upside continuation. At the moment a break and confirmation above 13100 will be a clear indicator that the upside extension is valid and dominant. We can see that clearly on the weekly chart below. Rejection in that zone or here could lead to a huge downside reversal and a retest of the important 11200-11500 zone.
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We have used the combination of the top-down trading analysis to get these key levels explained in the charts.
