Tuesday, October 2, 2018

DAX30 - 03 October 2018


Fundamental Highlights

The DAX lost 45.1 points, closing at 12273.8 as Italy's increased spending budget plan weighs down on European stock markets with concerns of Italy spiraling down an uncontrollable debt path. Even though Italy's populist 5 Star movement doesn't control a majority in the government that would allow it to push for an "Italexit" , a comment by Claudio Borghi- head of the lower house budget committee- that "Italy would solve all of its problems if it had its own currency" triggered a sell-off in equity markets and pushed the EUR/USD to its lowest since August 21st. In economic news, Eurozone PPI edged lower to 0.3% from last month’s 0.7%, but above the estimate of 0.2%. Today, we have the German Composite PMI and the German Services PMI coming out at 07:55 GMT. Later on the Eurozone will release the Services PMI and the Retail Sales figures at 08:00 GMT and 09:00 GMT, respectively.

Technical Analysis

The DAX bounced off the support level at 12208.5 and formed a lower high on the hourly chart, confirming the downtrend. Market is currently wedged between the 200 period SMA from below and the 20 and 50 period SMA from above with a cross bound to occur soon. A reversal bar candlestick formed at the touch of the downtrend indicating further bearish momentum if price remains below the downtrend and doesn't print higher than 12297.4

Support: 12208.5 12172.7 12126.9 12049.5
Resistance:.12344.9 12407.4 12459.6

Chart (H1)