German index goes back and forth for the week

The German index went back and forth during the course of the week, forming a neutral candle. The €12,750 level is an area that has been both support and resistance in the past, and I think that it’s good to be difficult to hang onto a trade in the meantime, but it does look like the buyers are trying to step in and push. We have made a “lower high” on the weekly chart, so that does concern me, but we are starting see on shorter-term charts a proclivity to go higher. Beyond that, the ECB is talking about quantitative easing, and perhaps walking away from it. This could be a bit of a two way play though, because stronger European economies means that the DAX will attract certain amount of money as it is the “blue-chip index” when it comes to the European Union.

However, we got some fairly soft German numbers on the day Friday, and that could suggest perhaps the ECB isn’t quite ready to raise interest rates. The June 14 meeting will be crucial as to where the DAX goes longer-term, but right now it looks like were making a fight to the upside. The €13,600 level above has been a recent high, and if we can clear that level the market will finally make its move towards the €15,000 level. Expect volatility, so I would keep my position somewhat small as the noise could make the trade difficult to hang onto.

DAX Video 11.06.18