FX.co ★ DAX index breaks below key horizontal support.

DAX index closed today below the 14,800 price level which was considered a key horizontal support level. This support level was tested over the past 11 months, more than three times and each time price respected the support. This price action has confirmed the importance o the support line.

Blue lines- bearish divergence

Red line -broken neckline support

The Dax Index is in a bearish short-term trend. Price has broken the horizontal support and has already warned traders with weekly bearish divergence signals. The RSI has provided us with these warnings at the beginning of the year. Now we find price almost 2,000 points lower. Current weekly chart points to the start of a bigger correction in DAX and price looks vulnerable to more downside. Most probable target is around 13,800 where we find the pre-pandemic highs which we believe will act as support now.