Trade of the Week: long DAX 40 index
Since the DAX 40 last week held at key technical support, we would like to go long the index at 15,700 with a stop-loss at 15,400 and an upside target of around 16,400.
(Video Transcript)
DAX 40 futures index looks promising
Hello and welcome to this week's Trade of the Week on Monday, 21 August 2023. Last week my colleague, Chris Beauchamp, went long the DAX contracts and as you can see here unfortunately he got stopped out because the DAX index continues to slide.
So despite that I would like to go long this week the DAX 40 index and the reason for that is that I believe the three-way corrective move we've seen since the early August highs has probably run its course now because we tested the support seen back at the beginning of July and have held there.
German index climbing high
Today we are seeing some upward momentum and I'd expect this to continue perhaps in low-volume trading over the next few weeks as a lot of people are still on holiday but I do think, from a technical perspective, that we are above the 200-day simple moving average which you can see here in red and that we are likely to hold in this support area and that we may be heading back up again towards the high seen between May and August of this year.
So this week's Trade of the Week is to go long the DAX 40 index at 15,700 or so with a stop loss just below the 200-day simple moving average at 15,400 and an upside target around 16,400. Thanks for watching.
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