Wednesday, August 7, 2019

DAX30 -07 August 2019


Fundamental Highlights

The DAX ended 0.78% lower on Tuesday as global trade uncertainty continues to weigh on market sentiment. The DAX alongside global markets found some relief during the day as China took steps to stabilize its currency after deliberately devaluing it against the dollar. Separately on economic data, in contrast to improvement in factory orders data yesterday, today Germany showed continued weakness in industrial production as the figure drops by 1.5% in June. Expect corporate earnings out of the DAX’s members today to impact price action while trade headlines remain in focus as trade concerns dominate market sentiment and maintain a risk-off environment.

Technical Analysis

The DAX fell to a low of 11445 before trimming some of its losses to end 90 points lower at 11567 on Tuesday. The daily chart shows a spinning top candlestick representing indecision which suggests that bearish momentum may have started to weaken. Moreover, the daily RSI remains in the oversold territory suggesting that the index may advance before turning lower. Look to the 11650 level near the 200-day MA to determine whether the DAX should extend its bearish development or exhibit a short-term reversal. A sustained move above 11659 would indicate buying pressure and target resistance at 11750 followed by 11830. Alternately, a sustained move below 11650 would maintain selling pressure and potentially lead to a re-test of the support at 11445.

Support: 11440/11390
Resistance: 11750 /11830

Chart (1D)