DAX Edges Lower But New Highs Beckon

If we see a retracement towards 12220 then I will seek bullish setups to assume a break to new highs.

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As we approach European open DAX sits beneath the Daily Pivot, after retracing from record highs overnight.

Ideally we will see a deeper retracement towards 12210-26 which has several technical levels to help support it. First off this zone houses the March high (and recent break out to new highs) but also houses a 23.6% and 38.2% confluence, with Daily S1 pivot.

For the brave, this makes it suitable for intraday short positions to consider against the bullish daily and weekly trend (assuming we remain below the Daily Pivot).

Alternatively we can seek intraday bullish setups above the daily pivot, in line with the weekly and daily trend. Alternatively we can stand aside and wait to see if the deeper retracement is seen towards 12,226 and forms a basing pattern.

With sentiment on Euro crosses increasingly bearish then the break to new highs on European stocks is the obvious choice, so I would prefer to stay in line with this bullish trend, thus avoiding any short positions at these highs.

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