DAX gains, as no majority in France is announced
The DAX, Germany's benchmark stock index, is currently experiencing a bullish sentiment after a period of uncertainty surrounding the French elections. With concerns regarding a potential far-right victory easing up due to the recent parliamentary decision, investor confidence has received a boost. This positive shift is reflected in the DAX's price.
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The DAX, Germany's benchmark stock index, is currently experiencing a bullish sentiment after a period of uncertainty surrounding the French elections. With concerns regarding a potential far-right victory easing up due to the recent parliamentary decision, investor confidence has received a boost. This positive shift is reflected in the DAX's price.
The DAX surged by more than 1% on Friday, however in the afternoon due to the Parliamentary elections in France on Sunday last week, traders traded cautiously, so the DAX closed with only 0.2% at 18,461 points. A weekly profit of 1.3% was noted however. In the afternoon, comments by Le Pen however took back the praise that most probably a majority will outcome will not be met, and that she warned of chaotic situations should a a mandate be given by the Government.
This result means that, for the first time in history, France finds itself in a situation in which no party has achieved an independent majority in parliament.
DAX- Technical Analysis
Technically the DAX could work off our predefined target, since the last days, DAX should continue its stabilisation dynamic, and could reach its 1st target of 18,665 which is the last trading high from last Friday.
Should the DAX be able to overcome this resistance, then 18,890 would become the second resistance which represents the all time high of the 15. May 2024.
Should the DAX decide to go in the opposite direction, then the Fridays low around the 18,418 would become the next support, which coincides with the EMA50. The next level would be the 18,267 level which is also the canter of the Bollinger bands.
Recently at 8:00 German time German Trade Balance (May) printed over expectations at 24.9B opposed to 22.2B last report. Giving further boost to the DAX price.
The Eurogroup report will come out at 13:00 which could produce further volatility.
1D Chart Analysis
Trendlines: The price is currently above an ascending trendline and closing in on a second ascending trendline indicating an overall upward trajectory.
Moving Averages:
20-day EMA: ≈ 18,200
50-day EMA: ≈ 17,700
200-day EMA: ≈ 16,300
Volume: Increasing volume as the price approaches the resistance zone, indicating strong buying interest.
Stochastic RSI: Near the overbought region, possible reversal or a strong continuation.
1H Chart Analysis
Volume Profile: Significant volume around 18,300-18,500. Most trading activity has occurred in this price range.
Moving Averages:
20-hour EMA: ≈ 18,470
50-hour EMA: ≈ 18,400
200-hour EMA: ≈ 18,200
Support and Resistance Levels:
Immediate resistance at ≈ 18,700
Immediate support at ≈ 18,200
Stochastic RSI: Moving upwards, possibly signaling a buying opportunity.
Conclusion
The Germany 40 (DE40) shows a bullish trend on the daily chart with strong ascending trendlines and increasing volume. However, the stochastic RSI in overbought territory warrants caution. On the hourly chart, the price is trading with higher volume around the 18,300-18,500 range, and currently approaching resistance at 18,700.
For tomorrows strategy, you should most certainly keep in mind the positioning of the FED representative Powell, where the FED notebank cheff will give insights as to the rate policy, as well as Thursdays German CPI
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