DAX Index Daily Fundamental Forecast – June 29, 2017
The 12550 region did its trick yet again for the DAX index and the index has lived to fight another day. We have been mentioning in many of our forecasts that this region marks the lows of the range and that a break below that would open the floodgates for a lot more selling which would push the index towards 12000 in the short term. We had also mentioned that this region has been witnessing a lot of buying in recent times and remains the last hope for the bulls.
DAX Bounces Off Range Low Again
And true to that, we saw a lot of buying come in yet again in that region yesterday and this helped the index to bounce off the range lows and push through 12600 during the course of the day as the stock markets in many parts of the world began to recover after falling through during the first few days of the week. This bounce has ensured that the DAX continues to trade within the established range and we can rest assured that, barring some surprises, we are likely to see the range continue to be maintained in the short term.
A hawkish Draghi on the day before had helped the euro to recover and push through the range highs while a clarification yesterday pushed the euro lower. That clarification said that Draghi wasnt as hawkish as the market had interpreted him to be and this pushed the euro lower and in turn helped the DAX and other stock markets in Europe to recover. Though the clarification states that the ECB isnt very hawkish, it is indeed true that the Eurozone economy is doing very well and there will come a time, very soon, when the ECB would have to seriously start thinking about tapering.
Looking ahead to the rest of the day, we do not have any major news from Germany and the Eurozone as a whole and so we can safely expect the consolidation and the ranging to continue within the established range of 12550 and 12950 in the DAX index.
This article was originally posted on FX Empire