Left shows the daily Ger30 chart. It is positioned in its bullish channel between the upper blue and red bands. Its RSI is above 50 (bottom green rectangle), which is the bullish side of the oscillator. However, the last eight trading sessions have drifted sideways in consolidation (upper green rectangle). This may be setting up a platform to take prices higher, given the positive indications.
Right is the GER30 hourly chart. The momentum-based stochastic has crossed positively (black ellipse). If it can move to the 80+ area and hold (blue arrow), an underlying positive momentum will be present and supportive of the GER30.
The hourly price is supported at the S1 and S2 pivots but there needs to be more positive movement. The previous three candlesticks are spinning tops which are candles of uncertainty. Bulls have tried to take price up and bears have tried to take price down, but neither has succeeded. A bullish cross by the trend-following EMAs followed by angle and separation to the upside will be regarded as positive.
The Ger30 is likely to take direction from US markets as big tech earnings are expected. Amazon, Alphabet, Microsoft and Meta Platforms will release Q1 earnings this week, which are likely to introduce volatility. Besides influencing the tech sector, the earnings are likely to affect the broader market as well. This is because advertising sales make up a large part of Alphabet and Meta's revenue, which will give indications on the general health of consumption. Amazon will also provide important consumer information.
Alphabet and Microsoft will report today, Meta will report on Wednesday, and Amazon reports on Thursday.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.