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DAX® – Highest closing price in history – Columns

Highest closing price in history

The DAX defends the breakout marks in the form of the old highs at 15,502 / 15,538 / 15,569 points. Despite the market fluctuations in the meantime, the German standard values ​​again reached a closing price above the 15,600 point mark yesterday. The dissolution of the sliding zone between 14,800 and 15,500 points over the past few weeks and the procyclical investment buy signal on a point and figure basis also contribute to the promising starting position in terms of the chart. From a money management perspective, yesterday’s low (15,477 points) confirms the importance of the breakout marks mentioned above. The 15,477 point mark is therefore a close-knit stop-loss. A few more sentences on the current sentiment survey by the American Association of Individual Investors (AAII). There is still a high neutrality rate among American private investors (36.2%). For a few weeks now, the proportion of neutrals has been well above the historical average – in the past it was often the ideal breeding ground for a new trend impulse. However, the low bear share, which has fallen below 20% in the current week, is a burden.

DAX® (Daily)

Chart DAX®

Source: Refinitiv, tradesignal²

5-year DAX® chart

Chart DAX®

Source: Refinitiv, tradesignal²

Promising starting position

Last Wednesday we examined the “big picture” of the precious metal. But even on a EUR basis, the gold price currently gives a convincing technical picture. First of all, the textbook pullback to the old record levels from 2011 and 2012 at 1,400 EUR – reinforced by a Fibonacci cluster of two different retracements (1,418 EUR and 1,399 EUR) contributes to this assessment. Even more important in terms of chart technology, however, is the break in the correction trend that has existed since August 2020 (currently at EUR 1,477). Thanks to this outbreak, the entire breather over the past few months can be interpreted as a trend-confirming flag (see chart). In this context, the recapture of the 38-week line (currently at EUR 1,530) provides additional emphasis, especially since the outbreaks described are confirmed by various indicators. For example, the trend followers MACD and Aroon recently generated new entry signals synchronously. On balance, the gold price in EUR should therefore return to its previous record high (1,758 EUR). In purely mathematical terms, the above flag formation even results in a price target of EUR 1,825.

Gold in EUR (Weekly)

Chart gold in EUR

Source: Refinitiv, tradesignal²

5-year gold chart in EUR

Chart gold in EUR

Source: Refinitiv, tradesignal²

Long-term tide change

After the break in the long-term bearish trend since 2008 (currently at 195 points), the CRB Index also managed to jump over the high of May 2018 at 212 points in May. The raw materials barometer is thus at its highest level since mid-2015. At the same time, the entire price development since the beginning of last year can be interpreted as a “V-shaped” reversal pattern. The two ultimate prerequisites for a sustainable change for the better – trend break plus trend reversal – have therefore been met. From the height of the reversal formation described, there is perspective a connection potential of up to around 300 points. On the way to this region, the 2010 low of almost 250 points marks an important milestone. Ultimately, this chart is a warning to all investors that the current discussions on the subject of “inflation” will not fall silent so easily. The particular charm of the current breakout situation, however, lies primarily in the possibility of using a narrow stop loss. In future, it is important to prevent a relapse into the previous downward trend since 2008 (195 points). Conversely, this protection leads to an attractive risk-reward ratio.

Refinitive CC CRB TR Index (Monthly)

Chart refinitive CC CRB TR index

Source: Refinitiv, tradesignal²

5-year refinitive CC CRB TR index

Chart refinitive CC CRB TR index

Source: Refinitiv, tradesignal²

The next key zone in sight

“You should know this buy trigger,” was our headline on April 22nd with reference to the Wheaton share. What was meant was a spurt over the combination of the correction trend since August 2020 (currently at USD 40.34) and the 38-week line (currently at USD 43.14). Since the mine title has now succeeded in this liberation, the entire correction of the last few months can be interpreted as a (upward) trend-confirming flag (see chart). The consolidation pattern described thus once again underlines the previous, multi-year bottom formation since 2013. In this mixed situation, a sustainable recapture of the old 2011 record high at USD 47.60 would provide additional evidence of strength, which would pave the way to the all-time high of August 2020 at 57 , 89 USD levels. In purely mathematical terms, the height of the flag above even results in a long-term target price of USD 74. In other words: in the future, the share will even be able to move into “uncharted territory”. In order not to jeopardize the current bank, it is important in future not to fall back below the key zone mentioned at the beginning.

Wheaton Precious Metals (Monthly)

Chart Wheaton Precious Metals

Source: Refinitiv, tradesignal²

Wheaton Precious Metals 5-year chart

Chart Wheaton Precious Metals

Source: Refinitiv, tradesignal²

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