Two trades to watch: Dax, Brent

Dax hits fresh all time high. Brent strikes $60 a level last seen pre-pandemic.

Uptrend 2

Dax hits fresh all time high


An upbeat mood in the market is lifting the Dax as investors cheer the prospect of additional US fiscal stimulus after Friday’s NFP report.

On Friday the US Senate passed a budget resolution that allows for the passage of the fiscal stimulus package in the coming weeks without Republican support.

Vaccine rollout figures are outweighing concerns over vaccine efficacy

German industrial production 0% vs 0.3% exp.

Eurozone Sentix consumer confidence up next.

Dax technical analysis 

After slipping lower in late January, the Dax found support from the lower band of the ascending trend line pattern on the daily chart. It rebounded steeply higher. 

The Dax trades above its 20 & 50 sma on the daily chart confirming a bullish trend. 

The RSI is above 50 but below the key overbought 70 level supportive of further gains.

Immediate support can be seen at 14195 the fresh all time high hit today. The price has since eased back slightly, a move over this level which also coincides with the upper band resistance of the ascending trendline is needed before the Dax targets 14500.

On the downside support can be seen at 13850 20 sma prior to 13650 the 50 sma. A move below 13500 lower band of the ascending channel would negate the current uptrend.

Learn more about trading indices




Brent strikes $60 per barrel, appears overbought


Oil hit a fresh yearly high on Monday boosted by supply cuts among kjey producers and hopes for additional US stimulus measures which would boost demand.

Short term demand weakness is being overlooked by the demand recovery expected later in the year.

Weaker USD is also supporting oil making it more affordable for holds of other currencies.

Brent technical analysis

Brent has climbed steeply since the start of February, reaching $60 overnight a level last seen pre-pandemic. 

Brent trades +0.9% at the time of writing above its 20, 50 & 100 sma on the 4 hour chart, showing an established bull trend.

However, the RSI has moved into overbought territory. The formation of a hammer candlestick pattern overnight also indicates a reversal so a pull back could be on the cards before a further extension past 60.

Immediate support can be seen at 59.00 the 20 sma prior to horizontal support at 58.00 (swing low 4th Feb) and 57.15 50 sma.

On the upside a break through $60 could see the price target 6230 a pre-pandemic support turned resistance level.

Learn more about trading commodities.

The complete guide to trading oil.

More from DAX

Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.