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DAX is ready for a countermovement

Regarding the last high at 9891 Mid of September the German stock market has lost approximately 1000 points. The DAX is now oversold. A technical rebound is possible. 

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Source: Bloomberg

The German blue chips reached the support at 8982/8952 on the 8th of October. But this trend line was not broken down. This was very important for the DAX. The mentioned price level was already tested in March and August this year.

The oscillator Relative Strength Index (RSI) with the parameters 21 days and the oversold and overbought levels at 40 and 60 shows an oversold situation. Above the level at 40 the DAX could start an improvement. Target price would be the former support at 9345/9435.

However the technical situation is difficult. The DAX remains in a sideways movement. A new buy signal would be generated above the resistance at 9800. Currently this scenario is not realistic. 

German stock market DAX on daily basis

Daxchart10092014
IG Charts

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