The DAX index started to rally higher after clearing up the major resistance at 12498.67. Currently, the DAX price is trading near two years high and such an extended bullish rally might result in the bearish correction. DAX price shoots up with making a decent price gap. Minor correction in the DAX index might fill the gap and but an extension of the corrective move might result in a deeper fall. If the DAX bulls manage to retain control of this market, we might see a test of the major resistance at 13592.50 which is also the high of 1st November 2017. But the DAX bulls might require significant fundamental support to carry on the current bullish rally.
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On the downside, the DAX price might drop towards the critical support at 13174.09. A daily closing of the price below the 13174.09 might result in a sharp fall in the DAX index. However, a sharp fall in DAX price towards the major support at 12803.51 might confirm the end of bearish correction. However, the DAX bulls are still in full control of this market and in the absence of definite bearish reversal, free fall in the DAX price is highly unlikely. But still, the optimistic bulls are advised to stay cautious since steeper rally usually results in a deep correction.Download our latest quarterly market outlook for our longer-term trade ideas.
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