DAX Index Moves Higher on Buoyant Risk Sentiment

The DAX finally seems to have been freed of the 13000 region and looks set to move higher in the short term. The improvement in the risk environment over the last few days has helped the bulls to sustain their gains and continue to push higher as the market seems to be set for more bullishness for the short term.

Index Continues to be Strong

We had been mentioning over the last few forecasts that the region around 13000 would be a tough nut to crack and could also lead to some consolidation and profit taking in the near future. This turned out to be true and that is why we have been seeing ranging over the past few days. But the fact that the index continue to trade near the highs of the range showed that the bulls were still in control and that it would only be a matter of time before the breakout happened.

Also, the incoming data from the Eurozone has also pointed to the possibility that it is quite likely that the tapering of the QE would be delayed which means that the ECB would continue with the program for the short and medium term. This should help to support the buy side and could also be one of the factors that is helpful in pushing the index higher at this point of time. Looking at the larger picture, we are still not out of the woods as far as the index is concerned though it is quite possible that the index would move higher towards the 13200 region before there is any kind of correction in the near term.

Looking ahead to the rest of the day, we do not have any major economic news or data from the Eurozone or Germany and hence it is likely that the DAX would continue to trade in a buoyant manner over the next few days.