The DAX 30 index is looking set to record an eighth straight week of gains, which have taken it above the 50-week SMA, following the rebound from the 11710 support. The sharp buying interest drove the price towards a new 16-week high of 13074.50, while the momentum indicators are supportive of the bullish picture.
Looking at the daily timeframe, the RSI indicator holds above the 70 level and is sloping up; some caution may be warranted given that the indicator is in overbought territory. Moreover, the stochastic oscillator posted an upward crossover – the %K line moved above the %D one – while it is approaching the 80 level. Additionally, the price is moving further above the 50- and 200-day simple moving averages (SMA), supporting the view for a bullish bias.
Further gains should see the 13130 resistance level, taken from the trough of January 16. In case of an upside break, the index would likely meet resistance at 13600, this being its all-time high.
In the event of a downside reversal, the next support barrier to have in mind is the 200-SMA at 12698.53 before the 12650 hurdle comes into view. If there is break below this level, the price could meet the 50-SMA around 12450.
In the medium term, the bullish outlook remains intact, with the moving averages pointing upwards.
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