The German benchmark index has been moving inside an ascending channel since the month of April. The last upward leg ended on May 19, when DE30/EUR made a high at 11,231. After that high, it has been creating a corrective pattern that created a double top. Today's action created three large bearish candles that broke the last low and pierced through the 50-period SMA in its 120-min chart. After that it has made a bounce that engulfed the two previous downward candlesticks, but its momentum is fading near the 0.5 Fibo level.
After a double top and a break of the previous double low, it is likely another leg down to test the recently made lows and continue further down towards its 200-period SMA and, even till the bottom of the channel. Thus, a new short-trade setup could be made which combines both target levels for an excellent reward/risk ratio. The idea is to place a limit-sell order at the 0.5 Fibo level with a target above the last market high, and two profit-taking targets: 10.825 and 10.590. The combined reward/ risk is 1.6
Main levels:
Limit Sell entry: 11,059
Invalidation level: 11,253
Profit target 1: 10.825
Profit target 2: 10,590
Reward/risk: 1.6 approx.