DAX Index Daily Fundamental Forecast – August 2, 2017

The DAX index rose higher yesterday as the European stock indexes had a bullish day. For a change, some good economic data brought in some strong reaction from the markets. Over the last few weeks, any good economic data was accompanied by a fall in the stock markets as it brought the spectre of tapering closer but yesterday the situation was different and it should have brought up a smile among the stock market bulls.

DAX Recovers

The DAX staged a smart recover from below the 12100 region and it moved above that and also above 12200 and it trades quite comfortably above this as of this writing. But, we still believe that the index is in the hold of the bears and that the downtrend in likely to resume at any point of time. So, any such move up is likely to be used as an opportunity to add to the shorts and also to get out of any longs that may be existing. All of this would ensure that this move up is only a correction.

We expect the DAX index to start moving lower later in the day though the start of the day has been pretty strong and this bullish streak is likely to dominate the first half of the day. The index is likely to face a lot of selling in the 12350 region in the short term and we do not expect the index to move much higher than this and then we should be in for a period of consolidation and ranging. The traders would also have to deal with the risk factors associated with the upcoming elections in Germany and this is likely to keep the DAX under pressure.

Looking ahead to the rest of the day, we do not have any major news from Germany and that is likely to ensure some consolidation and ranging for the day.