Technical Analysis – GER 30 Index bulls looking strong ahead of all-time-high

Anthony Charalambous, XM Investment Research Desk

Germany 30 Index (Cash) bounced off the 50-period simple moving average (SMA) yesterday, which resulted in a pickup in positive momentum and four successive positive sessions to retest the 23-month high of 13,548.

The short-term oscillators suggest that positive directional momentum is strengthening. The MACD, remained above zero, and is increasing over its red trigger line, while the RSI is rising in bullish territory. Moreover, the ADX reflects a strong positive trend in place, also aided by the uptrend line drawn from August 2019 and the upward sloping SMAs.

To the upside, initially buyers will tackle the fresh high of 13,548. Breaching this peak, the all-time-high of 13,600 could challenge the ascent ahead of the 13,648 resistance, which is the 138.2% Fibonacci extension of the pullback from 13,455 to 12,947. Climbing higher, the 150.0% Fibo extension of 13,767 could impede the bulls from reaching the 161.8% Fibo extension of 13,840.

Alternatively, reversing back down from the high of 13,548, the 50-period SMA at 13,412 could interrupt the test of the 13,380 low. Steering underneath, the 100-period SMA at 13,328 may obstruct the price from challenging a key fortified support of 13,258, involving the 200-period SMA and the 50.0% Fibonacci retracement of the up leg from 12,967 to 13,548. Diving deeper, the uptrend line may prove tough to get through with the 76.4% Fibo of 13,105 residing below.

Overall, the very short-term is neutral-to-bullish with a close above 13,600 reviving the bigger positive picture.