GER30 Weekly Price Action Opens Possibility For Swing Low

  • GER30

Weekly Chart

Further to our previous article, the GER30 charted a lower low this week at support (blue shaded horizontal). Since hitting this level, bulls have attempted to push the price higher, and the current action is off the low for the week. This has set up a potential swing low. However, for this to take place, short-term candles will need to chart a higher low and close above this week's high (aqua horizontal). We note that the current candle is still active, and key levels may change before the close of trade on Friday.The stochastic has rolled over, and the RSI is below 50 (aqua ellipses). These will need to turn positive to signal that the swing low is being supported by market participants.

Past Performance: Past Performance is not an indicator of future results.

The Daily Chart

The daily charts show the price to be in the area of weakness. This is between the lower blue and lower red bands. Today's candle (still to complete) is an inside day. I.e., its current range is within yesterday's range. Bears have paused and not taken price lower, but the bulls still lack the confidence to take the price higher than yesterday's high. A movement from the weak area to the neutral area will suggest that the bulls are back in the market. This will support the possibility of the weekly swing low scenario.

Past Performance: Past Performance is not an indicator of future results.

The Hourly Chart

The hourly chart suggests bullish momentum. The EMAs are in a bullish formation and the stochastic is above 80. If the EMAs develop angle and separation and the stochastic maintains its current level, short-term market participants may very well be looking to take advantage of current price levels. This sets up the causality as follows: the hourly strength will take the daily chart closer to moving out of weakness. This in turn will add credence to the weekly swing low scenario at support. However, if the hourly stochastic drops out of 80, the bulls will seemingly be losing control to the bears, which, in turn, will add pressure to the index.

Featured Image by Gerd Altmann from Pixabay

Russell Shor

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.


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