Intraday Market Analysis – Dax Extends Consolidation

Intraday Market Analysis – Dax Extends Consolidation

GER 30 tests key support

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The stock markets recover as a discussion between Biden and Xi raises hopes of a thaw in US-China relations.

The Dax 30 has found buying interest on the daily support (15450).

A bullish RSI divergence suggests a loss in the sell-off momentum. Traders were eager to buy the dip in this area of congestion when the RSI showed an oversold situation.

A rally above 15740 would confirm the rebound. 16000 would be the target when buyers regain confidence. Otherwise, a slide below 15450 may trigger an extended correction.

CADJPY hits key resistance

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The loonie stalled after Canada’s mixed employment data in August. The pair has previously broken below the demand zone at 86.60, putting buyers on the defensive.

The latest rebound has turned out to be a dead cat bounce after the price saw strong selling pressure at 87.35. An overbought RSI was an opportunity for sellers to step in.

Sentiment remains bearish in line with the downtrend initiated in early June. 86.40 is the last line of defense for the bulls and a fall below may trigger a sell-off to 85.50.

XAGUSD sees bearish breakout

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Bullions weakened after the US dollar advanced on better-than-expected producer prices.

The break below the rising trendline has put silver’s recovery at risk. Then the bears’ push below the critical support at 23.80 was an indication that they have gained the upper hand.

An oversold RSI may cause a limited bounce.

The bulls have the daunting task of lifting offers around 24.40 to turn the downbeat bias around. If momentum traders join in, a cascade of sell-offs may target 23.40 and then the psychological tag at 23.00.

Jing Ren

Jing Ren is a Macro-Analyst at Orbex. Jin has over 8 years of experience specializing in the currency markets, tracking the macroeconomic and geopolitical developments shaping the financial markets. Jing applies a mix of fundamental and technical analysis and has a special interest in inter-market analysis and global politics.