Trade headlines dominated market action and drove the DAX index 0.4% higher on Monday as President Trump’s extension to the March 1st trade deadline relieved the index sensitive to Sino-US trade developments. Despite trade optimism, upside on the DAX should be fairly limited given Germany’s soft economic data and risk of US auto tariffs on the EU. Germany releases consumer confidence report today while price action on the DAX index should be led by trade headlines and cues from global markets as the day stores Brexit updates from PM Theresa May and a statement by Fed Chairman Powell.
The DAX index managed to hold above the 11500 level to end at 11505 on Monday. Though the technical outlook remains positive, a shooting star candlestick formation on the daily chart suggests bullish momentum has weakened and sellers have gained control with strong support found at 11380. A move below this level alongside an RSI reading below the 50 mid-line would suggest further downside pressure towards the 11270 level.
Resistance: 11560/ 11670