The DAX Index was the outperformer in Europe as it ended virtually flat at 12345 on Thursday despite dismal economic data. On Manufacturing PMI figures, Germany and the Eurozone remain in contraction territory and continued to reflect weakness in the manufacturing sector. German retail sales data showed a decline of 2.1% in its year-on year report and a decline of 0.2% vs an estimate of 0.4% in its monthly report. With no major economic releases from the Eurozone today, The DAX may take cues from Wall Street as the US releases its monthly employment figures.
The DAX continued its range bound price action on Thursday as the DAX struggles to pick up bullish momentum. The price reached the resistance at 12400 before nudging down to reside within the narrow bollinger bands suggesting impending volatility and direction. Meanwhile, the daily RSI reading remains overbought suggesting there is potential for a deeper pullback with a break below support at 12250. Alternately, a sustained move above 12300 indicates buying pressure with a break above 12370 required to signal the continuation of the rally towards resistance at 12460