One of the largest European stock indices, DE 30 (DAX) breaks an important trendline. More recently, I mentioned this possible move after the trend channel (green).
When the market broke the channel (green) a few months ago, it was like a technical analysis textbook. The market was tested again from below, where important EMA (resistance) was pointed, and the market went down.
After the price cut, the price trend was down on the long-term trendline (white) that the market respected and bounced off many times. Subsequently, there was a chance of creating a double bottom formation that did not come into effect because the market could not break the neckline at the level of € 11,660. He could only create Lower HIGH.
This week, we saw the downward trend of this trendline. But what does that mean?
The chart shows an area that can serve as the main support. As in the past, there is a chance that the price will test the edge of the broken trendline (white). Another significant level is the previous Swing LOW, where the breakdown happened (11,031 €) and there is a chance that the market could test it. The market did not help even the deteriorated PMI results a few days ago. We can note that, despite zero interest rates and sufficient inflation or a weak Euro, the index and stocks move sideways or fall. This is a clear signal that the economy is beginning to slow down.
It should be remembered that it will be important to watch the weekly candle close that will tell us more. From a technical point of view, climbing and closing under the trendline is not a good signal.
This analysis serves as educational content and cannot be considered as investment advice. When you are trading I recommend you watch out your money and risk management.