#202503 - priceactiontds - weekly update - dax
Good Evening and I hope you are well.
comment: Neutral. Last week I noted that my bearish bias was probably not good since us markets were bullish enough and dax could not move below 20100. The big gap up on Tuesday was the first clue to refrain from shorts and on Wednesday bears gave up and we melted higher until Friday’s close. The upside is now probably very limited but it’s too early for most bears. My max target above is around 21200 and until bears print either a very huge down day or we had 2-4 days sideways to down movement with a retest of 20900/21000, I would not look for swing shorts.
current market cycle: Bull trend (wedge or channel, difference does not matter) until we get below 20300 again.
key levels: 20500 - 21200
bull case: Bulls are in full control since Wednesday and they will likely get 21000 and maybe a bit above it. Their problem is that they are buying high with multiple upper trend lines which could still be resistance. That argument is somewhat weak in the face of a strong trend and that is what we had last week. You never know how far they go but it’s climactic behavior and structuring longs above 20900 is tough. Longs only on strong momentum.
Invalidation is below 20500.
bear case: Bears gave up on Wednesday and they will probably wait for 21k and a reaction there. Never try to be the first bear. Let the big institutions show you where there is no more bid and then let the profit taking begin. V-reversals are so rare that you should almost never worry about them. Bears first target is the gap close 20675 and then the second body gap to 20574.
Invalidation is above 21200.
short term: Neutral. We have a clean channel/bull wedge up and we are very close to the upper trend line. Could go a bit higher before potentially reversing. 21200 is my max target.
medium-long term from 2024-01-18: Market will likely hit 21000 and then it’s about patience to time the shorts right.
current swing trade: Last swing short was not good but part of the game. I am waiting for bears to come around again.
chart update: Marked potential targets for both sides.
comment: Neutral. Last week I noted that my bearish bias was probably not good since us markets were bullish enough and dax could not move below 20100. The big gap up on Tuesday was the first clue to refrain from shorts and on Wednesday bears gave up and we melted higher until Friday’s close. The upside is now probably very limited but it’s too early for most bears. My max target above is around 21200 and until bears print either a very huge down day or we had 2-4 days sideways to down movement with a retest of 20900/21000, I would not look for swing shorts.
current market cycle: Bull trend (wedge or channel, difference does not matter) until we get below 20300 again.
key levels: 20500 - 21200
bull case: Bulls are in full control since Wednesday and they will likely get 21000 and maybe a bit above it. Their problem is that they are buying high with multiple upper trend lines which could still be resistance. That argument is somewhat weak in the face of a strong trend and that is what we had last week. You never know how far they go but it’s climactic behavior and structuring longs above 20900 is tough. Longs only on strong momentum.
Invalidation is below 20500.
bear case: Bears gave up on Wednesday and they will probably wait for 21k and a reaction there. Never try to be the first bear. Let the big institutions show you where there is no more bid and then let the profit taking begin. V-reversals are so rare that you should almost never worry about them. Bears first target is the gap close 20675 and then the second body gap to 20574.
Invalidation is above 21200.
short term: Neutral. We have a clean channel/bull wedge up and we are very close to the upper trend line. Could go a bit higher before potentially reversing. 21200 is my max target.
medium-long term from 2024-01-18: Market will likely hit 21000 and then it’s about patience to time the shorts right.
current swing trade: Last swing short was not good but part of the game. I am waiting for bears to come around again.
chart update: Marked potential targets for both sides.
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