This week DAX has shown quite good days as its new bullish pattern says that DAX can go above 7000 level but considering its success rate 6850–6900 is the average. So I can say that DAX has acted on its new bullish pattern and any more moves in the upside will be bonus. DAX is making higher highs and higher lows and now I want to consider on breaking around 6900 level (may be not this week) and if DAX is able to break that then there are better days waiting for it.
On the other hand minor pull backs (like what we saw in the last day) are quite possible, considering its moves in last few weeks. But unless it breaks solid levels like 6600 and then 6500, I will not be worried about that. If I consider its recent reversal then around 6562 (50% retracement) it will get the strongest support. Last week I was talking that DAX will create the bearish pattern if it tests 6150 level. That bearish pattern is still there but now I am not expecting that DAX is going to test such lower levels but after this week’s moves DAX may create a new short-term bearish pattern if it tests 6400 level in the downside.
So I will be looking 6600 very closely for any correction and if it maintains that support level then I am expecting more up moves in later days but I am not too much confident about levels above 6900 in coming week. Though things may become different if it does not correct in early to middle days of the coming week.
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