DAX Index Price Forecast July 26, 2017, Technical Analysis

The German index rose slightly during the day on Tuesday, as we meander around the €12,250 level. The market isn’t necessarily showing signs of momentum, and I believe that this will be a relatively quiet session until after the FOMC reports its Statement. If the tone is dummies, that could send the EUR/USD pair higher, which weighs upon German exports and therefore drags this index down. However, if the Federal Reserve is hawkish, that could send the EUR/USD lower, and that helps with exports coming out of Germany, thereby showing signs of support in this market.

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Given enough time, I believe that the market will continue to be a “buy the dips” situation, one way or the other. Because after all, even with a strengthening the EUR, the European Union is starting to show signs of strength. The question is the short-term effects of the currency markets. If we did breakdown below the €12,000 level, I would be a seller that point as it would be a bit of a trend change. Until then though, I think that the buyers are probably in control longer-term, but we could get a lot of volatility between now and when they step up and take control. Small positions will probably be the best way to play this market as we have seen so much in the way of choppiness, and should continue to do so.

DAX Video 26.7.17