DAX Recovery Faces Key Test as Bulls Challenge 25,500 Resistance

Tuesday, 13 October 2026 | Germany 40

DAX 40: Four-Hour Technical Outlook

Short-term bias: Bullish recovery | Daily bias: Neutral | Conviction: Moderate

The DAX is attempting to recover following last week’s sell-off, with the 4H candle range, trading around 25,400–25,470 in the latest available market snapshots. The four-hour chart has improved, but the index is approaching resistance where the recovery could lose momentum.  

The geopolitical backdrop is also mixed. Donald Trump has called on Vladimir Putin and Volodymyr Zelensky to reach an agreement to end the war in Ukraine, while suggesting that the conflict with Iran could end soon. This has helped traders take more risk once more, as lower crude prices and easing bond yields would support European equities by reducing immediate inflation concerns. However, neither a Russia–Ukraine energy ceasefire nor an end to the Iran conflict have been confirmed. Also, ongoing Saudi strikes against Houthi targets are leaving the risk of renewed energy-market disruption elevated.

Adding to that, weakness in US technology shares, are weighing on Asian equities and US equity futures, as the KOSPI closed with a loss of -5.46%.

Four-hour chart: Buyers regain control

The four-hour technical picture has improved from the bearish conditions seen last week. The DAX has recovered above several short-term moving averages (20, 50 & 100 EMA), MACD has also returned above the center line & CMF has crossed over the control line. This indicates that buyers have regained some control of short-term momentum.  

However, the recovery is not yet a confirmed trend reversal. A breaking and remaining of the 25,525 level needs to be printed, to show a lasting bullish bias.

 The DAX is still in recovery mode, from its decline from the August high near 26,600, and the 200-day moving average remains an important obstacle on the 4h chart.

Key resistance: 25,450–25,600

The first significant resistance zone lies between 25,450 and 25,600. The lower boundary is the immediate technical hurdle, while 25,600 represents a more meaningful breakout level.  

A sustained four-hour close above 25,450 would strengthen the recovery. A break above 25,600 would provide more convincing evidence that buyers are overcoming the corrective structure, as the 25,600 level represents previous levels of increased volume concentration.

If the breakout holds, the next upside objective is around 25,680, where the 200-day moving average is located. Beyond that, the market would need to recover above 25,800, although that would require a broader improvement in market sentiment.

Conversely, a rejection from 25,450–25,600 would suggest that the rebound is running into supply. In that case, the index could return toward its nearest support levels.

Key support: 25,165 and 24,870

The first important support is around 25,165 (20 & 50 EMA), followed by the more substantial 24,870 region (previous cycle lows).

Holding above 25,165 would keep the short-term recovery atempt intact. A break below it would weaken the four-hour structure and increase the likelihood of a deeper retracement.

The 24,870 area is more significant because it coincides with the daily chart’s 200-day moving average in the latest published assessment. A decisive break below this region would damage the broader recovery and bring 24,600 into focus as the next downside reference.  

Trading scenarios

Bullish scenario: The DAX holds above 25,150 and breaks through 25,450. A sustained move above 25,600 would confirm stronger upside momentum and open the way toward 25,800. This is the preferred bullish setup, but confirmation is important given the elevated stochastic reading.

Bearish scenario: The index fails at 25,450–25,600 and falls below 25,165. That would indicate that sellers are regaining control, exposing the 24,870 support zone and potentially 24,600 if selling accelerates.

Consolidation scenario: The DAX remains between 25,165 and 25,450. This would suggest that the market is digesting the recent rebound rather than establishing a clear directional trend.

Fundamental catalysts: Energy prices and inflation

If oil prices continue to decline on credible progress toward de-escalation, then these lower energy costs could support European industrial companies and ease inflation concerns. That would support the current envirnoment for a sustained DAX recovery.

On the other hand, further attacks involving Saudi Arabia or renewed escalation around the Strait of Hormuz could reverse the decline in crude prices. That would raise concerns about energy costs, inflation and the European growth outlook.

Stay informed,

By Philip J Papageorgiou - Head of Investment Research

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