DAX Short-Term EWP Update

By: TheWaveTrading | Wed, Aug 29, 2012
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Today is the last chance in order to get a deeper retracement, if my short-term scenario, which I have been discussing for SPX, is going to play out.

It is obvious that the market is in a state of "limbo", with huge expectations, waiting for Bernanke`s speech next Friday. But, in my opinion the real price mover will be the ECB meeting next Thursday.

As a reminder my preferred scenario calls for a corrective wave (B) off the June 4 low that is tracing a Triple Zig Zag.

Since both the last up leg off the August 2 higher low and the current pullback is corrective I believe that the TZZ is not over yet as it need the last wave (C) up.

This scenario that I have been discussing for SPX can also be applied in the case of the DAX. (I use the future contract for this analysis).

DAX Futures
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In my opinion If price is now unfolding a Zig Zag down in order to establish the bottom of the assumed wave (B), it should be larger.

Hence the range of the 0.382 - 0.5 retracement should come into play.

In addition even though, lately, bearish set ups have to be taken with a grain of salt, there is a potential H&S, which, if its target is fulfilled, price could reach the 50 d - Trend Line off the June lows.

Today is probably the last chance for the bears to attempt to trigger sell stops below 6885.50 (the neckline of the assumed H&S).




Author: TheWaveTrading


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