DAX Pull-back to 4H MA200 likely

١٦ يناير ٢٠٢٣

The German stock index (DAX) is showing signs of exhaustion of the 2023 rally, following our strong buy signal last week. The 4H RSI hit and got rejected on the 84.600 Resistance level, which is where a Channel Up started on November 11 2022. The Channel Up made one last High before it broke below the 4H MA50 (blue trend-line) and started a correction (short-term) that hit the 4H MA200 (orange trend-line).

As a result, we believe it is worth to start building up sell positions for a medium-term pull-back to the 4H MA200. Keep in mind that the strongest long-term buy is when the 1D RSI approaches its oversold level of 30.000. That could happen, if DAX closes a 1D candle below the 4H MA200, near the bottom of the long-term Channel Up that started in early October.

The medium-term target is the 15500 - 15700 Resistance Zone of February and the long-term the All Time High of 16300.


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