DAX® – old trend: brake blocks and clocks!


HSBC Daily Trading

Old trend: brake blocks and clocks!

Former trend lines often prove their high relevance in the further course of an underlying because they play a role again much later in the chart. With the old upward trend since the end of 2018 (currently at 13,054 points), the DAX® currently provides a textbook example of this thesis. After all, the German standard values ​​were able to post follow-up profits in the past week, but the bottom line was that the share barometer failed again because of the trend barrier described. The trend line described had already acted as resistance at the beginning of June and the end of July. Does the old saying apply: “Three times is Bremer right?” Sprich finally succeeds in returning to the upward trend after the third attempt. The reward would be a continuation of the latest bull market. The price gap from February (upper gap edge at 13,501 points) should then be closed quickly before the previous all-time high of 13,795 is back on the agenda. On the lower side, however, the moving averages of the last 200 and 38 weeks (currently at 12,137 / 12,083 points) serve as a massive retreat area. The two “double averages” are therefore predestined as a strategic stop loss.


DAX® (Weekly)

Chart DAX®

Source: Refinitiv, tradesignal

Long term Tide change – long-term bottom formation

Regular readers of “HSBC Daily Trading” know our preference for long-term charts and high time levels. A textbook example for the additional gain in knowledge, which the latter in particular often provides, is currently the price development of the Freeport share Both candlestick reversal patterns also have near-congruent highs ($ 13.38 / $ 13.64) that have now been broken. This means that the scenario of a long-term bottoming out is also taking shape (see chart). The recapture of the 200-week line (currently at USD 13.05) and the “V-shaped” reversal of the last few months also contribute to this. The last-mentioned exchange rate pattern results in a long-term follow-up potential of around USD 8, which is sufficient to actually complete the stabilization process discussed in recent years. Despite constructive indicators (e.g. relative strength, MACD), the share should keep the above Do not go below the 200-week smoothing because that would endanger the current steep head.


Freeport (Monthly)

Chart Freeport

Source: Refinitiv, tradesignal

“Morning star” encourages you

Following the initial recovery from the end of March to mid-June, the Continental share finally allowed itself a breather. From a chart point of view, the breathing phase takes place in the form of a classic correction flag (see chart). The upper limit of the consolidation pattern coincides with both the 38-week line and the bear trend that has existed since November 2019 (currently at EUR 91.64 / EUR 92.34). In other words: A dissolution of the flag described above should provide a second recovery stage and lay the foundation for three-digit price quotations again. The most recent candlestick pattern provides a silver lining in this context, because the last three weekly candles form an almost textbook-like “morning star”. This constructive candlestick formation may provide the decisive starting point to actually carry out the flag break. Additional tailwind is currently coming from the Relative Strength (Levy), which is now well above its threshold of 1. In the event of an outbreak, investors can make new commitments on the basis of the above. Secure 38-week smoothing closely.


Continental (Weekly)

Chart Continental

Source: Refinitiv, tradesignal

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