Short-term bearish bias
Key levels: downside: 11330 / upside: 11440
The German index has met stiff selling pressures near the October high of 11830. Both MAs and the 11400 support level failed to hold, and the engulfing bearish candles was a strong signal that pessimism has been instilled in the price action.
The bearish cross on the 4H chart was followed by a steep drop in price. The pair has recouped some losses and is now testing the 30-period MA. We could expect more sellers to join in if the resistance succeeds in capping bulls’ advances. On the hourly, the price broke the MAs and support level of 11410, indicating that the short-term recovery might just have ended. The tentative trendline below would be a support line.
11330 near the trendline would be the immediate defence for buyers. On the upside, a rally above 11440 could dent the selling fever.