DAX Index Back to Range Highs

The DAX index has been getting a boost over the past 2 days as the fear grows in the Eurozone circles about the strength of the incoming data from the region. It has been quite some time that the DAX bulls have been able to get a boost and it is to their credit that they managed to hold the lows of the range when the index came in under immense pressure over the last couple of weeks.

DAX On the Charge

The index has been moving lower as the fear of a strong economic data from the Eurozone pushing the ECB to become bullish and begin the QE tapering has led to uncertainty on how the buy side would be affected. It may be a surprise that the index is moving lower when the economic data from the Eurozone is getting better but that is the current situation that the index finds itself in. This uncertainty has been the DAX move lower to the lows of its range with the geopolitics also adding to the pressure.

But over the last week or so, we have been seeing the risk sentiment pick up all around the world and we have also been seeing the incoming data from the Eurozone getting weak. This is not something new but it is only over the past few days that more and more leaders and bankers have begun to realise how the data has been getting weaker since the beginning of the year, after having raised a lot of hopes towards the end of last year. This could push the Eurozone back into recession and that is something that is likely to make the investors in the euro worried but conversely, it will keep the DAX bulls happy.

They have been showing their happiness by buying into the index and this has helped the index to move back to the highs of the range once again. It remains to be seen whether it would have enough momentum to push through the highs of its range. Looking ahead to the rest of the day, we do not have any major data from Germany or the Eurozone but we should see the DAX challenge its range highs.