European Indices suffered losses on Monday as news of Saudi’s attacked oil infrastructure slashes the global oil supply and heightens geopolitical tensions. The DAX declined by 0.71% as the news added to fears of a global economic slowdown already weighed down by US-China tariffs and the prolonged trade war. Today, the Eurozone and Germany release ZEW economic sentiment figures both of which are estimated to improve yet remain in negative territory as the region’s economic outlook remains bleak. The data should have a muted impact as geopolitical tensions dominate markets’ attention and maintains the risk-off mood.
The DAX lost 88 points to end at 12380 on Monday. The price gapped lower from its high at 12499 and traded below the 20-period MA around 12400. Look for a sustained move below the 20-period MA to maintain downside price action with a decline below 12300 required to signal further weakness and target the support at 12250 and 12200. On the other hand, a sustained move above 12400 would be required to indicate buying pressure and lead to a re-test of the high at 12499.
Resistance: 12400 /12500