Friday, September 27, 2019



Fundamental Highlights

European markets traded higher on Thursday at the back of trade optimism stemming from President Trump’s comments on reaching a trade deal with China. However, positive risk sentiment should remain fleeting with the lack of fundamental progress in US-China trade relations. Separately on economy data, the German consumer climate index ticked higher and provided support. Today, there are no major economic releases out of the Eurozone to impact direction however the US publishes personal spending and durable goods orders data which may influence direction on the DAX. Meanwhile, look to further developments on the US-China trade war, Brexit and impeachment of President Trump to influence sentiment and limit risk appetite.

Technical Analysis

The DAX gained 54 points to end at 12288 on Thursday. Since finding support around 12150, price has edged higher and managed to trade above the 20-period MA near the 12300 level however was limited by the resistance at 12350 near the 50-period MA. Today, look for a sustained move above the 20-period MA at 12290 to indicate buying pressure, with a break above the 12350 level required to lead the index to the resistance at 12400 which maintains the prevailing downtrend. On the other hand, trading below 12290 would indicate selling pressure with a break below 12200 required to lead to a re-test of the support near 12150.

Support: 12200/12150
Resistance: 12350 /12400

Chart (H4)