DAX Daily Fundamental Forecast – February 28, 2017

The DAX managed to recover somewhat from the deep correction that it had gone through towards the end of last week. That the correction came in at a time when the bulls had finally seemed like they had broken through, should be a warning sign for those wanted to buy the index. While the US stock indexes continued to make new highs almost on a daily basis as the Trump trade continues, the bulls in the DAX continue to flounder and find that they are unable to push the DAX beyond the 12000 market even after a breakout from the range.

DAX In Bull Run?

We had mentioned in our forecasts that the first half of the week is likely to favor the bulls and is likely to keep the DAX buoyant and that is what we saw yesterday as the DAX broke through 11800 and trades just below 11850 as of this writing. It does look bullish and looks good for more and with the stock indexes in the US making another high yesterday, as Trump finally started speaking about increasing the infrastructure expenditure, we should expect the effects of that to carry over to the DAX as well and we could see a strong start to the index today as well.

But towards the end of the week, we expect the bears to take control again and push the DAX back into range. We are increasingly sceptical of the bullish run that we have been seeing in the DAX over the past few weeks and are slowly considering to become a bear soon. But we still wait for something fundamental to change, as far as the markets are concerned to fully change our view.

Looking ahead to today, we do not have any major economic news from Germany and so expect some more consolidation and ranging with a bearish bias for the day.