DAX Index Waiting for Direction

The DAX index continues to struggle to break through the 13000 region as the consolidation and the ranging continues. There has not been much action in the markets over the last few days as the traders struggle to push the index higher despite some positive fundamentals.

DAX Struggling to Move Higher

The index is near a region of high resistance and as we have been saying many times over now, it is going to depend on a large fundamental change for the bulls to be able to gather enough momentum to push the prices higher in due course of time. That is unlikely to come anytime soon as we wait for further data and signals from the ECB. The ECB is clearly on the backfoot as far as the tapering and the ending of the QE is concerned as it has been struggling with the incoming data which continues to miss expectations and thus putting more and more pressure on the Eurozone economy.

In such a scenario, the ECB would find it impossible to taper or end the QE and in the same light, the euro has also been consolidating as the traders are not sure how to make sense of all this. After an initial period of weakness in the euro, we are now seeing it consolidating now and the same situation is being mirrored in the index as of this writing. We believe that this choppiness is likely to continue in the short term.

Looking ahead to the rest of the day, there is not much by way of economic data from Germany or the Eurozone and hence we can safely say that the consolidation and the ranging would continue in the short term as the traders and the investors digest the incoming news and look ahead for further changes to decide on the next direction.