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Lucas: Temporary recovery on the DAX
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Steve Lucas from 3c Analysis is focused on the DAX Index as technical indicators signal bearish exhaustion in the market. Buyers returned to the DAX yesterday close to the 38% pullback level of the 2015 gains, which helped the index to recover from its initial 200 point loss. This sharp recovery created a daily hammer, which as Steve points out is an indicator of bearish exhaustion. Recent positive manufacturing data shifted sentiment in the market. The Markit Germany Manufacturing Purchasing Managers’ Index beat the preliminary estimate of 51.9, coming in at 52.1.
With signals pointing to a temporary recovery, Steve is looking to buy at the market open and again on a move to 11325 points. He is targeting a move to 11550 and 11771.5 points. A stop can be placed at 11275 points.
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