Hi Traders! Dax forecast and technical analysis is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the H4 chart here.
On the H4 chart, based on the Heikin Ashi candles we can see that currently, we have strong bearish bodies in downward moving market conditions so it basically reflects a bearish environment. We may consider this as an evidence supporting the bears. In addition to this, the price has created a bearish hidden divergence between the first high that has formed on 25th November 2021 and the second high that has formed on 1st December 2021 based on the MACD indicator, which we may consider as evidence of bearish pressure. Also, we had a strong support zone and the price which was moving lower has broken below this zone and is holding below it. We may consider this as yet another evidence of bearish pressure. Currently this strong support zone is acting as a strong resistance zone for us. Until this resistance zone holds my view remains bearish here. We may now move down to lower timeframe and look for evidences supporting this bearish view.
Looking at the H1 chart, we could see that currently it looks like a correction is happening in the form of an ABCD pattern. While measuring the first wave of this correction using the Fibonacci expansion tool we have two key resistance zones that has formed. The first key resistance zone is formed by the 61.8%(15504.50) Fibonacci expansion level of the first wave and the H4 resistance zone. The second key resistance zone is formed by the 100%(15733.33) Fibonacci expansion level of the first wave and the H4 resistance zone. Until both these key resistance zones hold my view remains bearish here and I expect the price to move lower further.
Dax H4(4 hours) Chart Analysis
Dax H1(1 hour) Chart Analysis
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
You will also find a pretty extensive database of educational materials here in the blog – just use the search or check out the Forex Education section above.
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To your success,
Vladimir Ribakov
Certified Financial Technician
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