Worsening trade tensions are pushing the equity markets lower with the DAX 30 dropping by 160 points to close at 12059.5 as President Trump’s $200 billion tariffs on China could go into effect before the end of the week. With Eurozone retail sales declining by 0.2% and German Services PMI missing expectations yesterday, German Factory Orders released today are worse than expected (-0.9% vs 1.9%) adding pressure on the DAX. All eyes remain on US-China developments.
Technically, the German index has confirmed the bearish market trend as price breaks 12,122.4 support level and pushes technical indicators such as RSI to oversold conditions with no divergence patterns. The first target set at our support level of 11,895.6 with the uptrend line as second target.
Support: 12,122.4 11,895.6
Resistance: 12,315.4 12,617.6