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DAX Daily Fundamental Forecast – October 24, 2016

By:
Colin First

This week could turn out to be an important week for the DAX as it sits at its range highs but still continues to dawdle without a confirmation of the

DAX Daily Fundamental Forecast – October 24, 2016

This week could turn out to be an important week for the DAX as it sits at its range highs but still continues to dawdle without a confirmation of the range break at 10700. Normally, range breaks are very quick and we see the price or the index push through the range top or bottom quickly with a good follow through. In the DAX, we have seen the push through the range top but there has not been any appreciable follow through so far and this puts the break in question. That is why we advise our users to hold on to their buys just yet and wait for complete confirmation before jumping in. Normally, users could have taken a chance with this breakout but since we are very near highs, it important to double confirm before jumping into buys.

DAX Hourly
DAX Hourly

This week could tell us whether the break is for good as we have some important data coming up this week including German Ifo Business Climate and earnings releases from Volkswagen and Deutsche Bank. The earnings of Deutsche Bank would especially be watched very closely as there were some recent rumors about the stability of the bank and any reflection of that in the earnings release could make the market very nervy and push the DAX back towards its range between 10200 and 10700.

For today, we have the flash manufacturing PMI to be released during the euro session and that is likely to have some minor impact on the index but overall, we expect the index to consolidate today. We have many earnings releases scheduled for this week from the different companies in the US like Apple, Alphabet, Twitter etc and this will affect SP500 index which could in turn affect the DAX. So, we advice users who want to buy the index, to wait and watch for a confirmation of the break of the range top before jumping into buys especially with so much of data and corporate releases scheduled to be released this week.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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