Sat, Oct 23, 2021 @ 02:24 GMT
HomeContributorsTechnical AnalysisTwo Trades To Watch: DAX, WTI Oil

Two Trades To Watch: DAX, WTI Oil

Dax rises post elections, Evergrande risk eases

German election results show a narrowing win for the centre left SPD party. However, coalition talks will begin. SPD leader would need to form a coalition with FDP and the Greens. They differ on several critical issues.

Angela Merkel’s SPD party could still hold onto power if they collaborate with the FDP and the Greens.

Talks top form a new government could go on for months. However, the inclusion of business-friendly FDP soothes concerns over substantial regulation.

The broad mood in the market also supports gain in equities as Evergrande fears ease.

Where next for the Dax?

Last week the Dax slipped to its 200 sma on the daily chart before rebounding higher.

The Dax is looking to retake the 50 sma at 15700. The MACD appears to be forming a bullish crossover, supportive of further upside.

A break above this level and 15765 last week’s high and the falling trendline support could see the index look to target 16000 once again.

Failure to retake the 50 sma could see the price test 15450 September 9 low ahead of before bringing 14950 the 200 sma back into target

Oil trades at 2 month high

Oil prices are on the rise for a fifth straight day amid supply tightness and draws on inventories. US inventories ae at the lowest for two years.

Rising gas prices are also helping drive oil higher as oil becomes a comparably cheaper alternative for power generation.

OPEC members are also struggling to raise output owing to under investment or maintenance delays from the pandemic.

Where next for WTI oil?

Oil prices continue to rebound from the August low of 61.72, building on gains from the previous week.

Oil is facing some resistance around 75.00 amid multiple top formations.

The RSI is supportive of further upside whilst it remains out of overbought territory.

Clearance of 75.00 could see the price test 76.64 and head towards 80.00.

Failure to clear 75.00 could see 74.00 the July 30 top over support ahead of 73.00 the September 15 high.

It would take a move below 69.50 around the 50 &200 sma to negate the near term up trend.
DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Featured Analysis

Learn Forex Trading