DAX Index Fundamental Analysis – week of December 18, 2017DAX continues in tight range, something that it has been doing over the past few weeks
The DAX index traded in a tight range and this is what we have been saying in many of our forecasts over the last few weeks. The index seems to be caught in a tight range and with the absence of any major fundamentals that could shift the markets, the index seems to be just content to chop around doing nothing much and this is likely to last for the next couple of weeks as well.
DAX Index Continues in Range
The fact that this happened in a week when there was the ECB rate announcement, statement and the press conference should be a massive sign that the index is not in a mood to go anywhere in a hurry just as yet. The ECB sounded a bit dovish in their statement as they improved their growth forecasts for the forthcoming months but also kept the QE at the current levels till September 2018. This was a mixture of good and bad news for the DAX and it showed.
This mix led to some choppy trading which saw the index move up by around 100 points and then drop again by the same amount and end up basically going nowhere. Even the rise in the US equities late on Friday following the good news around the tax reform bill, did little to shake off the traders in the DAX from their slumber and it closed the week within the range of the last few weeks.
This points to further dull trading in the following couple of weeks as we head towards the end of the year when most of the traders around the world go on their holidays and this leads to a drying up of the liquidity. There is also not much in the following week by way of major economic events and so we can safely expect the consolidation and ranging to continue for the coming week.