TechnoMeter

Lately, the DAX has been displaying messy price action, see-sawing back-and-forth with few clues as to what all the chop may mean. There is, however, one possibly bearish sequence developing should a lower-high maintain and continue along the path of building of a bear-flag. The bear-flag, if that is the eventual outcome, is arriving at an interesting spot given the underside parallel of the pattern is also the trend-line rising up from the March low. A break of the pattern would then have trend support violated in addition to pattern validation & a solid combination.



In this situation a lower-low would need to develop below 12547 for momentum to pick up in a meaningful way. Given the choppiness of the bear-flag, this isn't the easiest scenario and could lead to further horizontal price action. But we'll run with what is presented to us and adjust accordingly.

For the market to position itself for further strength, the grind higher at some point soon will need to pick up momentum and clear through the 12900s, but then also the trend-line off the record high and the May high at 13204. If it can do that, then a test of the old record high could be in order.

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