U.S. Markets close in 52 mins

Stock Indices Plummet Non-Stop as Coronavirus Drama Unfolds

Chris Svorcik

Dear traders, the German stock index DAX 30 made a massive bearish breakout after making a higher high earlier in 2020. Price is now back at the previous tops (green box) of 2007 and 2011 and the 50% Fibonacci retracement.

Monthly chart

The DAX 30 index could make a bullish bounce at the 50% Fib. The bulls are not expected to keep control. A retracement up to the 38.2% Fib of wave B vs A seems the most likely scenario. A bearish turn at the 38.2% Fib could take price down again via an ABC pattern (purple). An immediate breakout could spark an immediate decline to the 61.8% Fibonacci.

Daily chart

The DAX 30 is showing massive bearish momentum, which is why a continuation lower is always possible. If price does retrace, then a bullish ABC pattern is likely towards the round 10,000 level. The downtrend could continue again from this resistance zone.

Good trading,

Chris Svorcik

The analysis has been done with the help of SWAT method (simple wave analysis and trading)

For more daily technical and wave analysis and updates, sign-up up to our newsletter

 

This article was originally posted on FX Empire

More From FXEMPIRE: