European Indices traded lower on Friday as China’s GDP figure demonstrated weakening economic growth and raised concerns over slowing global growth. Elsewhere, the deal reached by the UK and EU on Brexit failed to be voted on by the UK parliament which delays the process and raises the likelihood of a general election that would register as a negative. News report that the UK government had requested an extension to the October 31st deadline and additional Brexit headlines would determine whether risk appetite should remain subdued. Today, there are no major economic releases out of the Eurozone to influence direction on the DAX leaving influence to geopolitical updates particularly that of Brexit.
The DAX lost 21 points to end at 12633 on Friday as price remained restricted within narrowing Bollinger bands. The index has yet to exhibit a breakout and take direction outside of the range bounded by the resistance at 12700 and the support at 12600. Look for a decline below 12600 to indicate a short-term reversal and target the lower support at 12500. Holding above 12600 would leave the DAX ranging with a sustained move above 12700 required to indicate buying pressure while taking out the high at 12820 would signal a bullish continuation.
Resistance: 12700 /12820