Thursday, September 27, 2018

DAX30 - 28 September 2018


Fundamental Highlights

The DAX gained 71.4 points, closing at 12420.4 on higher than expected MoM and YoY German CPI data of 0.4% and 2.3% respectively, along with positive remarks from ECB president Draghi on the growth of the EU economy while calling for a widening macro prudential toolkit to address risks. Investors however are still cautious as political uncertainty in Italy remains high with the Italian government announcing a delay in the country’s budget, augmenting fears that the coalition government could collapse as the budget bill comes up for a vote. In economic news, German unemployment figures for the month of September will be released at 07:55 GMT, with investors’ main focus on the Eurozone Core CPI, which will be released at 09:00 GMT.

Technical Analysis

The DAX bounced off the lower band of our downtrend channel yesterday to close the day with a bullish engulfing candle, however failing short of reaching the channel's price target at 12,475 . Bullish momentum will be conserved as long as the bullish cross between the 20 period SMA and 50 period SMA remains intact, and price doesn't retrace lower than our upper downtrend channel band. An hourly close below 12401.8 will lead to further retracement while a close above 12429.1 will push prices higher.

Support: 12344.9 12250.1 12176.9
Resistance: 12407.4 12481.9 12571.1

Chart (H1)