DAX Index Price Forecast March 5, 2018, Technical Analysis

The German market broke down a bit during the trading session on Friday, slicing through the €12,000 level, an area that I have been talking about for some time. The market breaking below there is a very negative sign, but I’m going to wait until we break down below the uptrend line that sits just below. I think that if we can close on a daily chart below the €11,800 level, the DAX is going to unwind and go to at least €11,000, if not as low as €10,000 next.

Alternately, we could break to the upside and if we clear the €12,100 level, the market should continue to go much higher, reaching towards the €12,500 level, and then eventually the €13,000 level. Remember, a lot of the noise is due to the United States placing tariffs on steel and aluminum, and the perceived possibility of a trade war coming out over these moves. If that does happen, it could be negative for all stock markets around the world. However, if there is very little in the way of reaction, I believe that the market will breathe a sigh of relief, and stock markets around the world rally. The question now is whether we are getting ready to break down, or are we offering value. I think there is far too much out there that could move this market around in the short term, so patients will probably be needed.

DAX Video 05.03.18