Wednesday, May 15, 2019

DAX30 - 15 May 2019


Fundamental Highlights

The DAX rose 0.97% and recovered some of Monday’s sharp losses as markets have digested the recent escalations in trade tariffs between the US and China. While trade uncertainty persists, President Trump made reassuring comments on the potentiality of a trade deal and aided the rebound. On the other hand, economic data was not in favor of the upside move as German and Eurozone zew economic sentiment figures fell into negative territory highlighting the region’s gloomy economic outlook. Today, Germany’s 1st quarter GDP matched expectations at 0.4% and the Eurozone GDP figure has yet to be released and is forecasted to grow at the same rate. In addition to influence from Euro data, The DAX may pick up cues from Wall Street as the US publishes retail sales figures today.

Technical Analysis

The DAX Index rebounded off of its low at 11850 to end at 11997 on Tuesday. Price bounced off of the support to reach the 20-period MA currently at 11990 which will determine near-term direction for the day. Look for a sustained move above 11990 to maintain buying pressure with the 50-period MA acting as dynamic resistance at 12120 on the downtrend. Until price breaks above resistance at 12200, the downtrend remains intact and recent gains are likely to be followed by a bearish continuation. Failure to hold above the 11990 level would maintain selling pressure and lead the Dow towards support at 11900 before a re-test of 11850 comes into view.

Support: 11900/11850
Resistance: 12090 /12120

Chart (H4)