Global equity markets gained ground last Friday as risk appetite broadly rebounded. With contagion concerns about emerging markets failing to materialize in any significant manner, the sense of feeling among traders is that the Turkish Lira meltdown is isolated. This bullish momentum is expected to continue today in German equities. Business confidence from Germany is due today at 11:00am UTC+3, headlining a light day for the European economics preview. The business climate index is seen rising to 101.8 in August from 101.7 a month ago.
From a technical perspective, the DAX is currently attempting to break out of its consolidation range. The index however is still showing some weakness on a daily chart therefore this bullish run will only be confirmed once the important resistance level at €12,500 is breached. The RSI is showing overbought conditions suggesting sellers might start coming back soon.
Support: 12335 12250
Resistance: 12425 12500