The GER30 index gained considerable traction this week, with the price breaching the downward move that started from the almost one-year high of 12,661 and passing through the Ichimoku cloud. The technical picture suggests a cautiously bullish bias for the short-term as the MACD keeps running above its red signal line and the RSI is flattening around the 70 overbought area.
The bulls could continue the rally until the 12,620-12.640 area. Should the bullish pressure strengthen above the 12,661 top, resistance could rise up to the 12,860 key barrier.
Alternatively a drop under the former 12,520 support level could push the price straight to the 61.8% Fibonacci of 12,482 of the downleg from 12,661 to 12,000, though the 50% Fibonacci of 12,417 may appear more interesting as any violation at this point would shift the current bullish sentiment back to neutral.
In brief, the GER30 stock index is likely to maintain bullish momentum in the short-term, though with the market trading in overbought area, a downside reversal is possible.
