DAX: A correction only

Having reached a new high at 10,048 points on the 20th of June the German stock market has started a correction.

bg_german_stock_exchange_1418457
Source: Bloomberg

At first the DAX fell below the level of 9900 points which seemed to be the beginning of the consolidation.

On 26th of June the German blue-chips stocks traded on intra-day-basis below the support at 9792/9795. At the end of the day the index closed above the mentioned level.

This could have been the rebound in direction of the high at 10,048. Above this level the DAX would generate a new buy signal. Price target is the level at 10,650.

Below the support at 9792/9795 the German stock market has got two supports. These are the trend line at 9631/9647 and the increasing 200-day moving average (weighted) at 9607.

Despite the currently correction the DAX could continue the midterm upward. The indicator mixture of MACD (Moving Average Convergence/Divergence), Momentum, RSI (Relative Strength Indicator) and Williams %R on monthly basis show intact buy signals. 

AUM_dailyDaxchart27062014
German stock market DAX on daily basis / source: IG Charts

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.