2024-05-21 - a daily price action after hour update - dax
Good Evening and I hope you are well.
overall market comment
Markets went mostly flat today. Nasdaq printed a new ath on another low volume day. Unless markets strongly break above the highs or lows, very uneventful price action. Play the range until it clearly is not working anymore. SP500 printed a tripple top now and selling it again is a reasonable trade.
dax
comment: Bears making lower highs and lower lows but they are too weak to push the market below meaningful lower lows. Bulls are not too eager to print yet another ath and so we chop inside they given range. My head & should pattern lives as long as market stays below 18835, which is 15 points from when I wrote this, so low probability. For now we continue to oscillate around the 1h 20ema but I think the daily 20ema is close enough now for more algos to buy it, for another ATH or another melt-up to my weekly targets.
current market cycle: trading range - bulls broke 19000 but no follow through.
key levels: 18700 - 19000 - below 18700 is 18400 next and above 18840 is 19000 or much much higher again
bull case: Bulls kept it above 18700 which is still uber bullish. Next they will probably break above the bear trend line from ath and above 18840 for retest of the highs. Invalid below 18800.
bear case: Still no gap close to 18850 and we are making lower highs and lower lows. Bears need to step in above 18800 to stay inside the drawn triangle. Bulls closed above the 15 and 1h 20ema, which is not good for the bears. They need strong momentum around EU open to break below again. Bears also have going for them, that US closed green today and retest the highs or made newer highs, while dax made lower highs and lower lows. Their next target below 18800 is 18700 and then the daily ema around 18650. Invalid above 18840.
short term: Neutral 18700 - 18840. Head & Shoulders has still a very low chance of breaking down to around 18400 but don’t bet on then unless you see many strong consecutive bear bars tomorrow.
medium-long term: My long term outlook stays bearish and I expect at least a -20% correction in 2024. Medium term is 17100 while I think we can touch the big bull trend line starting 2022-10 around 16700 in 2024. —unchanged
trade of the day: Long from the EU open was ok, since bears could not close the gap to Friday. Bullish enough for target 18900ish.
overall market comment
Markets went mostly flat today. Nasdaq printed a new ath on another low volume day. Unless markets strongly break above the highs or lows, very uneventful price action. Play the range until it clearly is not working anymore. SP500 printed a tripple top now and selling it again is a reasonable trade.
dax
comment: Bears making lower highs and lower lows but they are too weak to push the market below meaningful lower lows. Bulls are not too eager to print yet another ath and so we chop inside they given range. My head & should pattern lives as long as market stays below 18835, which is 15 points from when I wrote this, so low probability. For now we continue to oscillate around the 1h 20ema but I think the daily 20ema is close enough now for more algos to buy it, for another ATH or another melt-up to my weekly targets.
current market cycle: trading range - bulls broke 19000 but no follow through.
key levels: 18700 - 19000 - below 18700 is 18400 next and above 18840 is 19000 or much much higher again
bull case: Bulls kept it above 18700 which is still uber bullish. Next they will probably break above the bear trend line from ath and above 18840 for retest of the highs. Invalid below 18800.
bear case: Still no gap close to 18850 and we are making lower highs and lower lows. Bears need to step in above 18800 to stay inside the drawn triangle. Bulls closed above the 15 and 1h 20ema, which is not good for the bears. They need strong momentum around EU open to break below again. Bears also have going for them, that US closed green today and retest the highs or made newer highs, while dax made lower highs and lower lows. Their next target below 18800 is 18700 and then the daily ema around 18650. Invalid above 18840.
short term: Neutral 18700 - 18840. Head & Shoulders has still a very low chance of breaking down to around 18400 but don’t bet on then unless you see many strong consecutive bear bars tomorrow.
medium-long term: My long term outlook stays bearish and I expect at least a -20% correction in 2024. Medium term is 17100 while I think we can touch the big bull trend line starting 2022-10 around 16700 in 2024. —unchanged
trade of the day: Long from the EU open was ok, since bears could not close the gap to Friday. Bullish enough for target 18900ish.
