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DAX30 Completes Wave 4 and Bulls Aim at $16,000 Target

By:
Chris Svorcik
Published: Jun 4, 2021, 14:53 UTC

The DAX 30 is now testing the resistance trend line (orange) again. Will price action make a bullish breakout or a deeper retracement?

DAX30 Completes Wave 4 and Bulls Aim at $16,000 Target

In this article:

The German stock index DAX 30 made a new higher high after a bullish bounce at the 38.2-50% Fibonacci retracement levels – as expected in our previous DAX analysis.

The DAX 30 is now testing the resistance trend line (orange) again. Will price action make a bullish breakout or a deeper retracement?

Price Charts and Technical Analysis

DAX 04.06.2021 4 hour chart

The DAX 30 remains in a long-term uptrend. The Elliott Wave outlook even indicates a potential wave 3 (pink) of wave 3 (purple). That said, price action could be completing a wave 5 (grey) soon or with the next higher high:

  1. A bullish breakout (green arrows) above the resistance trend lines (orange) could indicate one more push higher.
  2. The targets are located at 15,740, 15,900, 16,000, and 16,100.
  3. A bearish breakout (orange arrows) below the support trend line (green) could indicate the end of the wave 5 (grey) of wave 3 (pink) and the start of a wave 4 (pink).
  4. The long-term moving averages could still provide a bounce (blue arrows).

On the 1 hour chart, the DAX 30 chart seems to be completing a bearish ABC (blue) correction in wave 4 (orange):

  1. Price action made a lengthy ABC correction (blue) as mentioned in our previous analysis.
  2. There was an ABC (green) pattern within each ABC (blue) wave.
  3. The bullish price action has either completed the wave 5 (orange) or indicates a wave 1-2 (green).
  4. The wave 1-2 (green) remains valid as long as price action stays above the previous low and 100% Fibonacci level. A break below it invalidates it (red circle).
  5. A bullish bounce or breakout (green arrows) confirms the uptrend.
  6. An alternative Elliott Wave outlook is that the blue wave B is a leading diagonal for a wave 1 followed by a wave 2. Also in this scenario, more upside is expected via a bullish wave 3, 4, and 5.

DAX 04.06.2021 1 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

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About the Author

Chris Svorcikcontributor

Chris Svorcik is co-founder, trader, and analyst with Elite CurrenSea (www.EliteCurrenSea.com) since 2014.

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