ECB day moved the Dax future within a range of 271 points.
Consecutive days will not follow normal behaviour of
market participants concerning time and volume
seen in calmer days.
This might be the moment to prove if market seeks
with bullish moves new ATH's or to correct price on
much lower levels.
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Some outlook with the bigger picture:
Ichimoku daily chart (underlying chart courtesy of boersen-knowhow.de, red comments
GFIs1) shows a highly probable scenario for the next two months:
1) Price and new ATH of yesterday is far above levels traded earlier this year
2) a down correction is indicated to a level of 9512 area
3) The support of the cloud is quickly shrinking now - meaning a coming weaker phase
4) The 9500 support is the last high starting november (red circle) as well as the 200 SMA
There are more indications to read out of that chart.
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A second correction might follow this first one a bit later - or heading again to new ATHs.
Depends a lot of the money printing around the world..
Last edited by GFIs1; December 5th, 2014 at 03:07 AM.
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What is behind the 150 point range rule?
Markets tend stay on certain price levels (POC in the volume profile for the interested).
Such day ranges for the Dax normally are within 150 points.
If this range is higher that means price is testing other levels. Be it new ATH or going
down to previous trade levels. After such moves the price might find a good "center" or is
attracted to get back to the previous level traded.
My trading plan is made for moments when markets are in synch. Means buyers and
sellers accept a certain price to be seen as a fair price. A break out of the 150 day range
makes the following day not tradable after the rules for synched markets. If the daily range
in Hi/Lo makes more than 250 points then 2 consecutive days are not tradable.
Better to sit on hands and let the shaked markets get back to normal...
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I am only considering US holidays that influence the Dax - especially the volumes.
Other closed exchanges don't have the same effect.
But for german & european holidays I am carefully looking on which weekday this happens.
As for holiday on thursday and making a prolonged weekend - this slows down volume on
friday drastically. For such days a check on Initial Balance (IB) is important.
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