The GER 30 stock index (DAX 30) is heading for its fifth monthly loss, dropping to a fresh 2-year low of 10,301 on Thursday. According to the RSI and the Stochastics which have entered oversold terittory, the market could see some upside in the short-term. Yet as long as the price maintains the lower highs and lower lows pattern below its moving averages and the Ichimoku cloud, the downtrend is not likely to be reversed anytime soon.
The selling could continue until the price reaches 10,130, a key support and resistance area between 2014 and 2016. Breaking that obstacle may push the index towards the 9,780 barrier, while even lower, a violation of the 9,380 mark could confirm additional rainy days for the market.
In case buying appetite returns, the index could stand as tall as 10,800. If the bulls manage to overcome that obstacle too, traders could look for resistance at 11,100, while higher still, the area between 11,500 and 11,700 would be closely watched as any decisive close above that region could signal the end of the bearish phase. The latter could also switch the long-term outlook from negative to neutral.
Summarizing, the GER 30 stock index is painting a bearish picture both in the short and the medium-term.
