Daily Technical Analysis is provided by Jason Sen of Day Trade Ideas, who has been day trading since the late 1980’s. Jason has been a contributor of Traders Summit since the beginning. He primarily focuses on providing technical analysis of the financial markets, including stock chart patterns, Forex and Metals setups, and other useful technical analysis.
Dax 40 December futures momentum is clearly negative as we break the July low at 12380/360. Yesterday we made a high for the day only 35 ticks above first resistance at 12350/400 before prices collapsed as expected.
We appear to have formed a 9 month descending triangle pattern & have broken the lower trend line. Yesterday we formed a bear flag so a break below 12000 is the next sell signal.
FTSE 100 December futures held Monday’s range so same levels apply for today but we are breaking lower over night.
Remember when support is broken it usually acts as resistance & vice-versa.
Update daily by 06:00 GMT.
Dax December broke support at 13100/13000 for a sell signal, then 3 month trend line support at 12700/650 for another sell signal & now the July low at 12380/360 for a new sell signal. Yesterday we made a high for the day just above first resistance at 12350/400. Then we crashed below 100 month MA support at 12200/150. As I warned you, the last 3 times this MA was tested, it did not hold, in 2009, 2011 & 2020. So now we have broken below 12000 (not a surprise!) & could drop quickly to 11700/700.
Gains are likely to be limited of course in the bear trend with resistance at 12100/12200. Shorts need stops above 12300.
FTSE December hit 500 day moving average support at 7020/7000 but we have 2 year 38.2% Fibonacci support & June low at 6950/6910. Longs need stops below the 500 week moving average at 6850. A break lower is a major medium term sell signal.
Bulls need a break above minor resistance at 7080/7100. A break higher meets strong resistance at 7160/80. Shorts need stops above 7210.
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Jason Sen, Director