DAX Index Price Forecast July 21, 2017

The EUR/USD pair spiked higher during the day on Thursday, and that sent the DAX down rather rapidly. We break down below an uptrend line, and it looks as if we may try to go looking for even lower levels. This was mainly due to noise coming out about an expanded investigation into Donald Trump, but upon further investigation, it does not look as if there is any reason to think that investigators are looking for anything specific, rather casting a wider net due to his global companies having reach around the world. This is simply doing a bit more digging, but not necessarily announcing that they have found something that’s worth considering. Because of this, it’s likely that this market may fade of the rally a bit in the EUR/USD pair, and that could provide a little bit of a lift for the DAX. Nonetheless, it looks as if the DAX has blown out a lot of stops, so I think we may continue to see a bit of bearish pressure.

€12,000

I believe that the €12,000 level below is the absolute floor in the market, and I believe that if we break down below there, the uptrend is over and we will start to see the DAX fall apart rather rapidly. Given enough time, we should continue to find buyers below, but I would not step in front of this candle. I would wait for the market to stabilize before I would be looking for value. Currency headwinds seem to be the biggest issue now, as it makes German exports much more expensive for the rest of the world, and therefore shrinks corporate profits.

DAX Video 21.7.17