Technical Analysis – GER 30 index possibly oversold in near-term; looking bearish in medium-term
March 5, 2018 12:26 pm
The Germany 30 index has managed to cross above the 12,000 handle – a level that may be of psychological importance – after previously falling as low as 11,729.50 during Monday’s trading and coming close to the one-year low of 11,691.60 that was recorded in early February.
The bias in the short-term is looking bearish as indicated by the negatively aligned Tenkan- and Kijun-sen lines. The Chikou Span however might be pointing to an oversold market, rendering a rebound in the near-term a possibility.
Index advancing could meet resistance around the 23.6% Fibonacci mark of the January 23 to February 6 downleg at 12,141.06. The area around this barrier also includes the current level of the Tenkan-sen at 12,171.50, with an upside break bringing into view the 38.2% Fibonacci level at 12,418.18.
On the downside, support might come around 11,866.20, this being a previous low with the range around it encapsulating a few bottoms from further back in time as well. Steeper declines would shift the focus to the one-year low of 11,691.60 for additional support.
In terms of the medium-term picture, it is looking bearish at the moment: Price action is taking place below the 50- and 100-day moving average lines, as well as below the Ichimokou cloud. In addition, a bearish cross was recorded in mid-February when the 50-day MA moved below the 100-day one.
Overall, both the short- and medium-term outlooks are looking bearish, with the caveat that an overextended selloff might have taken place in the short-term, something which keeps the possibility for a near-term price recovery open.
The Germany 30 index has managed to cross above the 12,000 handle – a level that may be of psychological importance – after previously falling as low as 11,729.50 during Monday’s trading and coming close to the one-year low of 11,691.60 that was recorded in early February.
The bias in the short-term is looking bearish as indicated by the negatively aligned Tenkan- and Kijun-sen lines. The Chikou Span however might be pointing to an oversold market, rendering a rebound in the near-term a possibility.
Index advancing could meet resistance around the 23.6% Fibonacci mark of the January 23 to February 6 downleg at 12,141.06. The area around this barrier also includes the current level of the Tenkan-sen at 12,171.50, with an upside break bringing into view the 38.2% Fibonacci level at 12,418.18.
On the downside, support might come around 11,866.20, this being a previous low with the range around it encapsulating a few bottoms from further back in time as well. Steeper declines would shift the focus to the one-year low of 11,691.60 for additional support.
In terms of the medium-term picture, it is looking bearish at the moment: Price action is taking place below the 50- and 100-day moving average lines, as well as below the Ichimokou cloud. In addition, a bearish cross was recorded in mid-February when the 50-day MA moved below the 100-day one.
Overall, both the short- and medium-term outlooks are looking bearish, with the caveat that an overextended selloff might have taken place in the short-term, something which keeps the possibility for a near-term price recovery open.
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