The German 40 cash index is continuing last week’s rebound but with slower momentum, reaching a five-week high near 14,600. The short-term bias looks positive as the MACD keeps gaining ground above its trigger line, while the RSI seems to be making its way up above its 50-neutral mark, though more progress is needed from the latter.
The 15,000 could be a trigger point for steeper bullish action if the index manages to break the 14,600 line. Even higher, the 200-day simple moving average (SMA) at 15,100 should attract some attention ahead of the 15,740 barrier.
However, if the price reverses back to the downside, investors could meet first at the 50- and then at the 20-day SMAs at 14,138 and 13,980 respectively. If the index continues to drop, support could next come somewhere between the latest lows at 13,270.
In the medium-term picture, the bounce off 13,270 turned the outlook from negative to neutral again. Chances for another bullish move are still rising as the short-term SMAs are pointing upwards.
