Monday, September 24, 2018

DAX30 - 25 September 2018


Fundamental Highlights

Even with better than expected figures released for the German Business expectations, German Current Assessment, and German Business Climate Index, the DAX lost 32.6 points yesterday and closed at 12350.8 as tariffs from the world's two biggest economies came into force with China canceling planned talks, triggering new fears of a prolonged and costly trade dispute. Losses in the Food & Beverages, Construction and Chemicals sectors led shares lower. In economic news, the German year on year and month on month WPI figures for the month of August (released today) came higher than expected at 3.8% and 0.3% respectively.

Technical Analysis

DAX tested our resistance level at 12407.4 and the 200 period-SMA from below at the 4H chart to retrace to the 2.618 Fibonacci level at 12344.9, breaking below the upper band of our parallel channel. The market has printed a lower high while still holding at the 2.618 level using it as a support (50 period-SMA also acts as a support). A breach of this support level will push prices lower towards our next support level at 12250.1 or the lower band of our parallel channel, depending on market momentum. While a close above 12372 on the hourly chart would indicate a further gain in positive momentum and a retest to 12407.4 resistance level.

Support: 12250.1 12161.5
Resistance: 12407.4 12481.9

Chart (H1)