DAX Index Daily Fundamental Forecast – December 5, 2017

The DAX continued to consolidate, as we have been mentioning in many of our forecasts of late, and this price action is set to continue in the short term as long as the coalition talks in Germany continued to move ahead. So far, there has not been any major developments in the coalition talks on either side and this has led to a stalemate as far as the market is concerned.

DAX Continues to Chop Around

The DAX chopped around on either side of the 13000 region as there were not many fundamental or economic drivers for the stock markets in Germany. The US stock indices rose high during early trading yesterday but then corrected lower towards the end of the trading session and this same price action template was followed by the DAX as well. The major stock markets of the world tend to follow each other when there are no domestic factors to drive the indices.

The last few days, this has been the case and with us approaching the end of the year and the adjoining holiday period, expect the volatility to reduce in due course of time and the consolidation is likely to continue till the end of the year, unless, of course, there is some progress in the political spectrum which would then push the index higher towards the 13500 region during the upcoming period. Merkel continues to negotiate to get the various parties on board her coalition in a bid to retain her position but so far, there has not been much headway but the talks continue and it is generally believed that some sort of deal would be made possible in the short term.

Looking ahead to the rest of the day, we do not have any major news from Germany. Expect some steady opening for the DAX index for today which should then lead to some consolidative trading within range for the day.