FOREX.com by StoneX logo

DAX currently facing mixed signals as investors await the outcome of Federal Reserve Chair Jerome Powell's testimony

Germany's blue-chip DAX stock index is currently facing mixed signals as investors await the outcome of Federal Reserve Chair Jerome Powell's testimony, which spans Tuesday-Wednesday.

Philip Papageorgiou
Philip Papageorgiou

Share this:

DAX currently facing mixed signals as investors await the outcome of Federal Reserve Chair Jerome Powell's testimony

Germany's blue-chip DAX stock index is currently facing mixed signals as investors await the outcome of Federal Reserve Chair Jerome Powell's testimony, which spans Tuesday-Wednesday. The index is hovering around 18,488 and is caught between potential short-term gains and a possible medium-term slowdown. Key technical levels to consider include support in high-volume areas around 18,170 and resistance at 18,718.

 

What effect will Powell's statement have?

Powell's comments on the US economy and future monetary policy could have a significant influence on investor sentiment and the direction of the DAX.

 

Why have the cost of borrowing mortgages and other loans remained so high over the past two years, and when could they start to fall?

Federal Reserve Chair Jerome Powell will appear before the Senate Banking Committee on Tuesday and the House Finance Committee on Wednesday, where he will face questions about monetary policy and banking regulation.

Some members of Congress have criticized the Fed for keeping interest rates high in the fight against inflation — a policy that they say has driven up the cost of living.

Powell could also be grilled over the proposed requirement for banks to hold more capital, which critics say would increase borrowing costs for individuals and small businesses.

DAX – Technical Analysis

Traders on the German market were cautious in yesterday's trading. This can be seen on the shooting start candle on Monday.

The early gain, which had arisen from the surprise announcement of the French parliamentary vote, was offset by yesterday's close of trading.

This is partly due to the unpredictability of the French elections, and partly due to other important market news, such as the US CPI on Thursday and the start of the banking reporting season on Friday.

The DAX opened at 18,600 points and closed almost unchanged on Monday.

The votes of the French have deviated from a right in favor of the left, but the votes do not yet show a majority in one direction.


The price is around 18,400 euros. This is close to the 50EMA, which the price managed to break through last week but did not stay there for long. If the price sustains above the 18,430 level, it would help the DAX move higher as the bulls could regain their strengths around this level.

If a retry is made, then there will be a break of the 50 EMA level, then the next target would be the July 5 high at 18,650, followed by the May 15 high at 18,890, which is currently the all-time high.

If there is a break, the DAX price will find support at the 20 EMA around the 18,267 mark. Followed by the 100-day EMA at 18,185 points. According to the volume profile, there is strong resistance at 18,500 EUR and strong support at 18,000 EUR.

Bullish indicators: The price is around the 50-day MAs and above the 100-day MAs that are trending higher.
Neutral indicators: The slow stochastic is in overbought territory, which could put pressure on the DAX in the short term. But at the moment, the movements only indicate the direction of the trend.

The speech by Jerome Powell at 3:00 p.m. is important, as he will provide information on the interest rate situation and can strongly influence the DAX and other markets.

The complete CFD trading experience

Award-winning platforms, competitive spreads, low commissions and dedicated support.

We live and breathe the markets and are dedicated to helping traders realise their ambitions as we continue to set the industry bar.

Economic calendar

Web Trader platform

Our sophisticated web-based platform is packed with features.

Related articles

dax-record-high-banks-cyclicals-election-relief-rally-european-stocks

The DAX has surged to fresh record highs as investors continue to rotate into banks, industrials and cyclical stocks following the US midterm elections. Falling bond yields, lower oil prices and improving sentiment have supported risk appetite across Europe, helping the index move decisively above 26,000. The focus now shifts from political relief to whether earnings and macroeconomic data can justify the rally's next leg higher.

dax-26000-bayer-siemens-energy-sektorrotation-us-zwischenwahlen

The DAX briefly reclaimed the 26,000 level as investors used post-election weakness as an opportunity to rotate into industrial, healthcare and energy-transition leaders. Strong gains in Bayer, Siemens and Siemens Energy helped offset weakness in consumer and AI-related growth stocks. With bond yields easing and the dollar weakening after the US midterm elections, investors are increasingly focusing on earnings quality, visible demand and infrastructure-related growth themes.

DAX Tests 26,000 as Markets Await AMD and US Election Results

The DAX remains close to 26,000 points after extending its recovery, but the market's attention is shifting away from geopolitics and back toward earnings, economic data and US politics. Reports from Bayer, Lufthansa and Fresenius Medical Care highlight a market increasingly rewarding profit growth while punishing weak guidance. With US midterm elections, JOLTS job openings and AMD earnings on today's agenda, the next move in equities may depend less on technicals and more on whether earnings and economic data justify current valuations.

StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.

StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.

It's your world. Trade it.