Germany 30 Index (Cash) is pushing under the 13,519 level, following a deflection off the 13,604 resistance from January 24. The candles reflect sellers’ efforts for a down move, something also reflected within the short-term oscillators, where negative momentum appears to be picking up.
The MACD deep in the positive region, has slipped below its red trigger line, while the RSI declines lower in bullish territory following an exit from the overbought zone. The Stochastic lines have reached the 20 level but continue to slope downwards. Noteworthy, are the gradual inclines in the simple moving averages (SMAs) and the steep gradient of the 20-period SMA completing bullish crossovers, which all endorse further improvement in the index.
If selling interest prevails, initial friction may rest at the 20-period SMA at 13,448 ahead of the 13,380 hurdle (previous resistance-now-support) and where the 100-period SMA currently lies. Piercing under this key level, the 200-period SMA at 13,351 and the inside swing of 13,309 beneath, could prevent the price from testing the 50-period SMA at 13,288 and trough of 13,221, a mark, which is keeping intact the ascent from the 12,884 low.
Otherwise, if buyers move over the 13,519 level, first to impede the climb is the 13,604-fresh high before the all-time peak of 13,639.19 bares its claws. Clearing the resistance ceiling of 13,639.19, the rally may head for the 13,772 level, which is the 161.8% Fibonacci extension of the down move from 13,455 to 12,947. If the bulls persist, the next barrier could come at the 176.4% Fibo extension of 13,846.
Overall, if the retracement in the near-term remains above the 13,380 support and more importantly the 13,221 low, the index’s improvement may bring about new highs.