the German DAX 30 index is testing the previous top which is a critical decision zone for a bearish bounce or bullish breakout.
The DAX 30 break above the resistance (red) trend line confirms (green check) the continuation higher within a wave 5 (green) of wave 3 (blue). The main targets are the Fibonacci levels of wave 5 vs 1+3. A bearish breakout below the support trend line (blue) indicates a potential bearish push lower to test the Fibonacci retracement levels of wave 4 vs 3, which are potential bouncing (green check) spots. The wave 4 (green) remains valid (red x) as long as the price stays above the 50% Fib.
The DAX 30 is building a bullish channel at the moment. Price will need to stay in the channel if the bullish continuation (green check) is to take place now. A break below the 61.8% Fibonacci level of wave 4 vs 3 invalidates (red x) the wave 4 (light green) pattern.
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