DAX Fundamental Forecast – February 23, 2017

The DAX finally managed to reach our short term target of 12000 but to be honest, it only barely managed to get over so far. Yesterday was another day of tight trading with the index ranging and consolidating. The bulls still dont seem to be in full control of the index but they do seem to be doing just about enough to keep pushing the index higher and higher and keeping the bullish run going.

DAX Meanders Along

The stock markets were generally quiet all around the world yesterday as all eyes was focussed on the FOMC meeting minutes that was released late into the US session. The minutes did not give much hints about when the next rate hike is to be expected and all that it could say was that the next rate hike can be there pretty soon. This was not the ideal meeting minutes that the markets had expected and so the stock indexes in the US did not know how to react and they ended up slightly lower for the day.

The effect of this late night news event can be expected to be seen in the DAX when it opens today and based on the reaction of the US stock indexes, we can expect some tight trading today as well with a bearish bias and we might see the index dip below 12000 but not by much. The buyers still do not seem to be confident enough to invest at the highs of the range and this is an expected reaction as the DAX had taken several weeks to break through the highs of the range and so the bulls are still a bit sceptical on how long this will last.

Looking ahead to today, we have the Final GDP and Consumer Climate data from Germany releasing during the London session and if this continues the trend of good data coming in, we could probably see a good bullish close later on in the day.