DAX bounce runs out of steam
A similar picture applies here for the DAX – the 1000 point bounce in the index from last week’s lows has now run out of momentum, with the Bundestag vote and Options Expiry today providing a handy excuse for traders to sit back and await developments.
We have yet to see a real dip here, so bulls need to decide whether any pullback today constitutes a buying opportunity or the end of the current bounce. If the index can recover 11,800 early on next week then I would be looking for fresh gains towards, and indeed above, the 12,000 mark.
On the downside, a close below the 100-day SMA (11,597) would incline me to think that the bounce has run its course, although I would still wait for further confirmation from a bearish turn in daily stochastics.
Dow bounce comes to an end, but looks healthy
Faced with Janet Yellen expounding her view on rising rates, US indices have run out of steam. The Dow Jones bounce has stalled below the key 18,200 area, but still looks reasonably healthy. If the bulls can regain control and push higher from here then a run at all-time highs still looks plausible. A daily close back below 18,000 would invalidate the bullish outlook.