DAX correcting towards its 7-month Support.
Earlier this month (January 08, see chart below) we gave a Sell Signal on DAX (DE4 as it had entered its 7-month Higher Highs Zone. Less than two weeks later, we are close to hitting our 24100 Target:
Given the recent macro news and the strong 1W candle reversal this week, we now expect this correction to be even stronger. With the Higher Highs pattern leading to the recent top being similar to the one in July 2023, both of which were 1W RSI Bearish Divergencies, we expect the index to aim for its 7-month Support.
This is what happened with the October 23 2023 bottom, so our medium-term Target is now 23000 (Support). Notice that the 2023 Low also made contact with the 1W MA100 (green trend-line) and the 0.382 Fibonacci retracement level, so that could put the validity of DAX's 3-year Channel Up to test.
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