Markets

DAX® – Difficult waters

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Difficult fairway

The DAX® is currently not in an easy position, because the German standard stocks also suffered price losses yesterday. The support zone in the form of the lows of October 15 and October 2 (12,600 / 12,540 points) is now coming into focus. Together with the lower Bollinger Band (currently at 12,486 points), an important technical chart bastion arises at this level. Due to the requirements, investors must expect the listed supports to be tested at the start of trading. Below that, the low of September 25 (12,342 points) should be added as another line of retreat. This level plays an important key role, because if it slips below this level, the sideways phase of the last few months threatens to turn into a top formation. On the upside, however, the first technically significant hurdle at 12,939 points (50-day line) awaits the German “blue chips”. According to this, traders in particular are likely to pay a lot of attention to the latest “swing high” from the start of the week at 13,029 points. The bottom line is for the DAX® to break through the series of losses of the last few days. Otherwise the risk of topping increases.

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DAX® (Daily)

Chart DAX®

Source: Refinitiv, tradesignal

With a new all-time high

At the end of September, Snap shares had one of our favorite approaches (see “HSBC Daily Trading” of September 29). This links the trend-following aspects of the concept of relative strength with the so-called Kelly factor. The latter takes into account in particular components of active money management, such as B. the probability of rising prices or the average weekly profit / weekly loss. Both influencing factors signal – then as now – an ideal upward trend for the technology stock. From a technical chart point of view, there is now a spurt above the previous record high of USD 29.44. The scenario of a “long-term bottoming out” that was shown at the end of September is thus given additional confirmation. The imputed minimum price target based on the successful trend reversal formation of USD 35 has already been exhausted. But trends often carry much further than investors can initially imagine. In order to secure previously accrued price gains, investors can reduce the stop loss for existing commitments to the level of the above. to catch up with old record highs.

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Snap (weekly)

Chart snap

Source: Refinitiv, tradesignal

Successful liberation

“Change for the better?” Was our headline on October 9th in relation to Under Armor stock. The paper has now cleared a decisive hurdle! What is meant is the former resistance zone from a Fibonacci level (USD 12.00), various highs and the downward price gap from March (upper gap edge formerly at USD 12.49). Thanks to the exemption described above, investors can expect a successful lower reversal (see chart). Their imputed connection potential can be estimated at around USD 5. The lows of December 2018 and November 2019 at USD 16.52 / USD 16.74 mark important milestones on the way to exploiting the price potential outlined. The constructive positioning within the framework of the “HSBC Trend Compass” or downward trend breaks in the course of various indicators (e.g. RSI, MACD) underline the currently favorable technical starting position. In order not to frivolously gamble away this steep template, the above will no longer apply in the future. Bastion dropping back at $ 12. From a risk perspective, this brand is therefore predestined as a stop loss on the bottom.

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Under Armor (Weekly)

Chart Under Armor

Source: Refinitiv, tradesignal

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