DAX Index Daily Fundamental Forecast – March 13, 2017

The DAX has continued to consolidate and range below 12000 with no specific push coming from the fundamentals for the bulls to make the move higher. It has been some tough work for the bulls who initially had to do a lot of work and took a lot of time to bring about a break in the range and this battle had been going on since the beginning of the year. It was only a couple of weeks back, when the bulls were probably on the threshold of giving up on the index, that the sellers finally relented and the buyers were able to push the DAX through 12000 and make the move stick for a couple of days.

DAX to Continue to Consolidate

Just when everyone thought that the bulls would finally be able to take control and push through to the first target of 12350, the bulls have floundered as they have been pushed back by more selling and also global cues which are not favorable for the next leg of the bull run as of now. The stock indexes in the US have been on the backfoot over the last week or so as the markets prepare for the FOMC rate announcement and hence, the same sluggishness is reflected in other major stock exchanges in the rest of the world as well.

The Fed is expected to hike rates this week and sound hawkish in the accompanying statements and this is already priced into the markets and hence we do not expect any sudden moves following the announcement, to last long. The DAX index continues to sit above the broken resistance and this is the only hope for the bulls to keep the index from falling back into range.

Looking ahead to today, we do not have any major news from Germany though we have Draghi speaking later on in the day. Knowing him, we believe that it would be a non-event and so we expect some more consolidation in the DAX index for today.