Dax March is now severely overbought having almost perfectly hit our target of 10,550

Daily Forecast - 23 January 2015

Dax March contract

Dax March is now severely overbought having almost perfectly hit our target of 10,550. There is a risk of profit-taking today down to 10,495 and perhaps far as 10,465/10,450. A good chance of a bounce from here but be aware that a break lower could target strong support at 10,415/10,405. Try longs here with a stop below 10,380. Just be aware that a break lower could then target 10,355/350 but if we fall as far as 10,330/320, use this as an excellent buying opportunity with a stop below 10,290.

Immediate resistance at the new all-time high of 10,548.5 of course but above here we could test 2 year trendline resistance at 10,600/10,625. We should struggle here and a high for the day is certainly possible. Try shorts with a stop above 10,660. However just be aware that a break higher could see prices race towards 10,740/750.

Emini Dow Jones March contract

Emini Dow Jones March has now tested three month trendline resistance at 17,770/780 and this will be key to direction today. There is a good chance we will turn lower and below 17,690 should add pressure to target 17,670 then good support at 17,635/625. Try longs here with a stop below 17,580. A break lower however sees 17,625 act as resistance to trigger a move down to 17,560. If we continue lower look for good support at 17,540/530. Try longs here with a stop below 17,475.

It could worth trying shorts at 17,770/780 with a stop above 17,810. Be ready to go with a break higher to continue the fourday rally and target 17,845/865. We will be quite overbought in the short-term at this stage, but if trying shorts, we need a stop above 17,885. A break higher is then likely to target 17,910, 17,940 and perhaps even make it as far as 17,980/985. Just be aware that above here meets the all-time high at 18,036/18,051.

Gold February Contract

Gold February remains worryingly overbought now & the 100 week moving average at 1308 could still mark a high as stated all week. Profit taking possible again today to relive overbought conditions. Immediate support at 1297 but below here could re-target trend line support at 1286/1285. If we continue lower look for a test of yesterday's low at 1179 then very good support at 1275/1274. This could hold the downside today but be aware there is stronger support at 1266/1265. It should be worth buying into longs here with a stop below 1260. A break lower meets support from the 200 day moving average at 1256/1254. Try longs here with a stop below 1248.

Strong resistance at 1307/1308. Again, it should be worth trying shorts with a stop above 1311. However be ready to go with a positive break higher using 1308/1307 as support, for a move up to 1313 then 1319 and perhaps as far as 1322/1324.