Thursday, May 30, 2019

DAX30 - 30 May 2019


Fundamental Highlights

The German blue-chip Index that is sensitive to the global growth outlook and world trade developments declined by 1.57% to end at 11837 on Wednesday. Economic data aided the downside move as Germany’s unemployment made a marked increased to 60K while the unemployment rate rose from 4.9% to 5%. Moreover, the ECB’s release of financial stability report highlighted the geopolitical risks that weigh on the region’s economic weakness. The data came in a time where a global bond rally sent treasury yields lower reflecting markets risk off mode and fears of a global economic slowdown. Burdening the prospect of global growth is the US-China trade dispute which threatens to further escalate as China considers retaliatory measures against the US. Today, there are no major economic releases out of the Eurozone, while the US publishes 2nd estimate of its 1st quarter GDP alongside jobless claims report and trade figures from which the DAX may take directional cues. In addition, US-China trade developments will continue to be monitored and dominate market sentiment.

Technical Analysis

The DAX Index posted sharp losses that drove price to end at 11837, below the crucial support at 11850. Given the sharp decline, it is likely to see a recovery attempt in the near-term should the support zone of 11830/11800 hold for the day. However, a decline below the 11800 level would point to a bearish development on the DAX and bring into view potential areas of support at 11760 and 11690. Meanwhile holding and trading above 11920 level may point to a rise towards the resistance zone of 11990/12000 level which keeps the DAX in negative territory.

Support: 11800/11760
Resistance: 11920/12000

Chart (H4)