The German index looks set to open notably lower on Friday, tracking declining US stock futures suggesting a more than 200-point drop for the Dow Jones Industrial Average as several prominent companies posted mixed earnings results after the US closing bell. The DAX closed higher on Thursday as the European Central Bank left its interest rates as well as its forward guidance unchanged for a third consecutive policy session and reaffirmed that asset purchases would end in December. Consumer sentiment from Germany and France are due today, headlining a light day for the European economic news.
As expected, the DAX rebounded yesterday dominated by bulls that lifted the market higher throughout the trading session. 24 out of 30 components closed in the green. The medium-term trend however is still clearly bearish, showing an intact downtrend in the short and medium terms. The short term momentum of the index is strongly negative, with RSI below 30. This indicates increasing pessimism among investors and further decline for DAX targeting the key technical support level at 10785.
Support: 10785 -
Resistance: 10460 11634