Monday, September 30, 2019



Fundamental Highlights

Germany’s blue-chip index traded 0.75% higher on Friday as the resumption of US-China trade talks in early October buoyed market sentiment. Later in the day however, The US administration revealed it would redistrict US financial investments into China which is expected to undermine trade optimism and weigh on sentiment. In terms of data, Germany published retail sales which beat expectations for August as it showed a recovery from a decline in the previous month. Later in the day, Germany releases unemployment data which is expected to influence price action. Apart from the data, traders should look to geopolitical news to remain the key driver of price action. Any news on trade developments will bear the strongest influence on sentiment.

Technical Analysis

The DAX gained 92 points to end at 12380 on Friday. The price continued to trade higher since finding support near the 12150 level and managed to trade above the resistance provided by the 50-period MA at 12350 to reach resistance at 12400. Failure to hold above the 12300 level near the 20-day MA would indicate selling pressure which would lead the index to the lower support at 12220 and negate the apparent bullish bias. On the other hand, holding above the 50-period MA at 12350 would maintain buying pressure with a break above 12400 required to signal a bullish continuation towards the resistance at 12460 followed by 12500.

Support: 12300/12220
Resistance: 12400 /12500

Chart (H4)