DAX Index Daily Fundamental Forecast – November 1, 2017

The DAX index continues to trade within a tight range as it prepares itself for the next move higher. We believe that the next move would be higher as the global stock markets continue to trade in a strong and steady manner and hence it is only a matter of time before the DAX also joins them. Also, the DAX is now free from any burden and so, we should begin to see the fundamentals show through.

DAX Stays Within Range

The DAX had been laid low for a few weeks due to the uncertainty over the QE tapering that was to be announced by the ECB. With the data from the Eurozone continuing to be strong, it was generally believed that the ECB would be inclined to cut the QE pretty quickly and once that was fully completed, the funds that are now available for the stock markets in Europe would no longer be freely available and this could lead to the prices moving lower.

But these uncertainties and fears turned out to be false as the ECB, though it did announce a cut in the QE, made it clear that the QE would continue for another year and this brought in a lot of cheer to the markets and helped the DAX to break clear of the 13000 region. With this region now cleared, the bulls would now focus on the next short term target of 13500.

Looking ahead to the rest of the day, we are likely to see the index continue to consolidate as the market awaits the next push. We do not have any major news from the Eurozone or Germany for today but we have the FOMC later today which is likely to make it clear whether there would be a rate hike in the US in December or not. This is likely to have an indirect effect on the DAX. For today, we expect a steady opening in the DAX which is likely to continue for the rest of the day.