I am revisiting my trade note I did on the German index (DAX 30) from 26 June where it looked like the early formation of a head and shoulders pattern.
Outlook:With the German economy still under pressure and international Bond yields firmly in the spotlight it looks like there might be another move lower on the index.
Looking at the chart below we can see the formation of the head and shoulders pattern nearing completion. The 11843 (neckline) support has been tested at numerous occasions and it looks like the price might finally break through. We can also see the formation of lower highs and lower lows in the right shoulder which supports the down trend.
Chart Source: Bloomberg
Trade: DAX 30
- Entry (Sell): 11896
- Stop loss: 12283
- Target price 1: 11478
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