DAX Turns Lower on Thursday

Wednesday’s optimism failed to materialise on Thursday and stocks slid broadly, with the DAX losing around 0.5 percent during the London session. US markets are closed today for the Thanksgiving holiday, but futures on the US indices remain open for most of the day.

The major support for the DAX index is now at previous lows near 11,050 EUR and if the price remains above, it seems like a double bottom pattern, which is a bullish reversal formation. The potential of this formation is around 600 points and the resistance of this pattern is slightly above 11,600 EUR.

From the intraday perspective, the first  zone to be taken advantage of remains at the bearish trend line, which is currently at 11,330 EUR. As long as DAX remains below this line, the immediate outlook seems bearish.

The RSI indicator suggests a bullish divergence on the daily chart, which could be a bit positive for DAX. However, bulls need to defend 11,050 EUR and then push the price above the trend line to negate the actual downward momentum.

The afternoon session will probably be very quiet, due to the closed US markets and therefore most traders will take Friday off. Normal trading should start again on Monday.

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