Intraday Market Analysis – DAX 40 Struggles to Rally.

GER 40 hits tough resistance


European markets struggle as embattled property giant Evergrande faces more coupon payments this week.

The Dax 40’s tentative break below the major support at 15050 weighs on traders’ risk appetite. Unless the bulls can push back and absorb offers at 15780, the index could be vulnerable to a deeper correction.

An overbought RSI has caused a stall in the recovery. A bearish MA cross may attract selling interest. 15400 is an important gatekeeper and a breach could trigger a sharp sell-off to 14900.

NZDUSD retraces to major support


The US dollar continues to creep up after the Fed’s hawkish tilt. The RSI’s overbought situation suggests that the kiwi’s initial breakout has over-stretched itself.

Buying interest could lie between 0.6980 and the psychological level of 0.7000. The bulls will need to clear the origin of the September sell-off (0.7110), and then they could seal the continuation of the rally towards 0.7210.

However, if this turns out to be a false rebound, a bearish breakout would dent the hope of recovery and send the pair to 0.6880.

XAGUSD tests critical support


The rising Treasury yields and US dollar weigh on precious metals. Some bargain hunters were eager to buy silver at the psychological level of 22.00, which is also critical support from the daily timeframe.

However, the rebound has seen strong selling interest at 23.10. Should buyers gather enough momentum to break free, 23.80 would be the next target.

On the downside, a bearish breakout would shake the last buyers out and conclude an eleven-month-long consolidation with a bearish reversal.

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