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DAX: Thanks to the moving average again

At the beginning of this week the People´s Bank of China had cut the reference rate of the currency Yuan.

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
bg_dax_1369829
Source: Bloomberg

At the beginning of this week the People´s Bank of China had cut the reference rate of the currency Yuan. Due to this the German stock market was under pressure. Some supports were broken down.

These supports are the trend line at 11,454/11,467 and the Fibonacci retracement (23.6 per cent) at 11,250. But one indicator could stop the downward trend. The DAX has been testing the 200 days simple moving average (SMA) at 10,985 and the psychological price level at 11,000 successfully.

Currently the German stock market is trading in the direction of the former supports. Shortly before the heavy price fall the DAX actually failed due to the intersection-resistance at 11,640/11,692. This is an important level on daily basis. Above this resistance the German blue chips would generate a new buy signal. In this case the next psychological level at 12,000 would be the technical target price.

German stock markets DAX on daily basis

DEM_DAXUpdate_130815
Source: IG charts

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.