The DAX 30 (FXCM: GER30 is lower by 1.24% at the time of writing. The index remains firmly bearish below yesterday's high of 9129 and traders will most likely use a correction to the 8859 to 8958 range to add to their bearish exposure as the risk/reward ratio favors bearish positions here.

Also, private traders who are long as they trade against the falling trend are expected to reduce their risk within this range. The FXCM SSI Snapshot sentiment indicator shows that there are 2.48 long positions for every short one. This suggests a lower DAX 30 in the days ahead.

The next support level and target for bearish DAX 30 traders is the 8672 level, followed by 8500 and the October 2014 low of 8355.

I see no reason to turn bullish as long as the index trades below yesterday's high of 9129.

Fed's Janet Yellen Keeps Rate Hikes on the Table

Initial jobless claims are on tap this afternoon and expected to decline to 280K from 285K, but not expected to change the trend or sentiment in any material way. The latest bearish leg in stock markets will most likely come about as the Fed's Janet Yellen is not discarding the possibility of a rate hike, with the Fed expecting that U.S. growth will remain on a moderate path. This boosted the Japanese Yen on risk aversion and has made it today's winner.

DAX 30 | FXCM: GER30

Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano