German index rallied significantly during the trading session on Thursday

The German index rallied significantly during the trading session on Thursday, breaking above the €12,400 level. By doing so, it looks as if the market is going to try to go to the €12,500 level above, which is even more resistive. I believe that the market will continue to be a “buy the dips” scenario, especially if trade tensions between the United States and China can soften a bit. I think that continues to be an opportunity for people to take advantage of the overall “risk on” attitude, and I think that the DAX is a great place to start looking to put money to work.

I believe that short-term dips will continue to be buying opportunities underneath, especially down to the €12,000 level, an area that is psychologically significant, and of course there is a nice uptrend line underneath near the €11,800 level that should keep this market afloat. It’s not until we break down below that area that I would be comfortable shorting the DAX, as it has been so strong as of late. In fact, when you look at this chart, you can see clearly that we had formed some type of basing pattern and it looks like we are going to continue the uptrend longer term. I think we could go to the €13,000 level, and then a move above there could send the market to the €15,000 level which has been my longer-term target. If we were to break down, I’m not sure where we would end up.

DAX Video 13.04.18