The German DAX climbed 0.8% yesterday breaking out of its range following positive US data and encouraging comments from Federal Reserve Chairman Jerome Powell on the US economy. Moreover, the EU and Japan signed a sweeping free trade deal on Tuesday, eliminating nearly all tariffs on products they trade and sent a clear message against protectionism. Looking ahead to the rest of the day, the DAX has the Euro-Zone Consumer Price Index to watch out for; another strong bullish upswing might take the index up to the next resistance level at €12,800.
The short-term momentum of the index looks slightly positive today. After a breakout from its range, it looks like the DAX will now climb up to the next resistance level at €12,800. But it will need a major fundamental catalyst to break through that second zone as well. Watch out for the RSI on a 1-hour chart as it shows extreme overbought conditions.
Support: 12410 12160
Resistance: 12640 12800