Monday, May 6, 2019

DAX30 - 06 May 2019


Fundamental Highlights

The DAX Index rose 0.55% to end at 12412 on Friday at the back of impressive corporate earnings from a member of the blue-chip Index. In terms of data, a solid US jobs report provided bullish support for the DAX while Eurozone inflation had little impact as the core CPI rose 1.2% yet remains below the ECB target of 2%. Today, Services PMI data out of Germany and the Eurozone are due alongside Eurozone retail sales figures. The data may be overshadowed by recent news that President Trump threatened to raise tariff rates on Chinese imports. The move casts doubt on the reported progress of trade negotiations between the US and China and may limit gains on the DAX which is vulnerable to world trade developments.

Technical Analysis

The DAX extended gains to reach a high of 12450 on Friday before US-China trade headlines prompted a decline in DAX futures this morning. Moreover, the daily RSI reading exited the overbought region which may lead the DAX to a deeper pullback towards support at 12090 followed by 12030 should it fail to find support at the 20-day MA around 12160. Alternately, price would have to hold above the 12250 level with a break above the 12330 level in order to restore the bullish outlook in the near-term.

Support: 12160/12090
Resistance: 12250/12330

Chart (H4)