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DAX Index Daily Fundamental Forecast – January 22, 2018

By:
Colin First
Published: Jan 22, 2018, 07:04 UTC

The DAX has finally managed to break through the highs of its range and it remains to be seen whether it can hold on to its gains

DAX Monday

The DAX index pushed higher for the day on Friday and finally seems to have broken through the range. The index broke higher and closed the day above the 13400 region which should give a lot of encouragement for the bulls in the coming days. But the reason for the break higher is unclear as yet and so it remains to be seen whether the break would hold.

DAX Pushes Higher

This is likely to be known in the short term as we look ahead to the ECB meeting, rate announcement and the press conference later in the week. There has been no specific trigger for the move higher in the index as the confusion and uncertainty continues to haunt the German politics as of Friday. It was only over the weekend that the SPD party decided to continue its negotiations with Merkel and this is likely to only drag on in the short term. The only positive thing that has happened is the fact that the euro has weakened.

DAX Hourly
DAX Hourly

The ECB members have rushed in to ensure that the market does not get too carried away by the news of the QE being ended by the end of this year. This news has caused the euro to fly higher and brought the stock markets under pressure in the short term and the ECB members seem to be wary about it. They have started to issue statements to control the weakness in the stock markets and this could also be one of the reasons for the index to start moving higher.

Looking ahead to the rest of the day, we do not have any major news from the Eurozone or Germany and hence we can expect a strong and steady opening to the index. The point of interest would be to see whether the index would be able to hold on to its gains and whether it would be able to sustain and push through the 13500 region.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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