Monday, October 7, 2019



Fundamental Highlights

The German blue-chip index traded 0.73% higher on Friday as the European bulls found ground on US labor data. The unemployment rate dropped to a record low and prevented downside pressure that would have otherwise stemmed from weaker than expected non-farm payrolls. Today Germany published its factory orders which showed a contraction of 0.6% versus an estimated decline of 0.3%. Market participants should look to trade headlines and Brexit developments to influence the currently cautious market sentiment ahead of the US-China trade negotiations scheduled this week. Risk appetite should remain subdued given the growing concerns over the health of the global economy.

Technical Analysis

The DAX gained 87 points to end at 12012 on Friday as price continued to edge higher since reaching the low at 11823 which is the level the 200-day MA currently sits nearby of. Today, look for a sustained move above the 12000 level to maintain buying pressure with a break above 12080 required to target the higher levels at 12150 and 12200 near the 50-period MA. Failure to hold above 12000 would leave the DAX ranging lower, with a decline below 11900 required to target the support provided by the 200-day MA at 11820.

Support: 11900/11820
Resistance: 12080 /12150

Chart (H4)