DAX, NZD/USD, BTC/USD and XLU Forecasts – Markets in Divergence on Tuesday

DAX Technical Analysis

The first market I am looking at is the DAX in Germany. We continue to see a lot of noise right around the 25,000-euro level and I think that remains the theme here. Can we hang on to 25,000 euro? It has been a little bit negative during the trading session, but it is all about trade protectionism and AI anxiety, much of which you are seeing in the United States. I do not think it is much different.

A new 10% global tariff by the US administration has put some pressure on export-heavy German auto sector companies, as an example, and European banks. This is a situation that I think will continue to keep this choppy, but if we can close above 25,000, that could lead to more of a grind higher. I would emphasize the word grind. This is not something I am looking for for an explosive move, but it does remain resilient and that is something that you have to respect.

NZD/USD Technical Analysis

The next chart is the New Zealand dollar. We initially tried to rally, but we gave back gains and this is one I am watching very closely because somewhere near 0.5920 or so, the bottom could fall out. This could be an excellent shorting opportunity, and it is worth noting that the US dollar has fought back quite bravely against many currencies after we got a 14-year high in US dollar short positioning.

The narrative suddenly became that the US dollar was not going to be the world’s reserve currency. That happens every 2 years or so and we were starting to hear it right about at the peak. I think the New Zealand dollar will be one of the first ones to crack if the US dollar starts to strengthen again.

BTC/USD Technical Analysis

Bitcoin, I am watching this one to see if we break down below the 60,000 dollars level. I am not looking for a buying opportunity here; the best thing that you are looking for in Bitcoin right now is stabilization. I think the sentiment is so bad in Bitcoin that breaking through 60,000 dollars is a very real possibility and we could be looking at 55,000 dollars.

Quite frankly, it is a different market now. Institutions are involved and institutions do not chase assets that lose 40%. It just does not happen. This is not a bunch of retail traders trying to FOMO back into the market. There are a lot of concerns because Bitcoin is not used for anything on a day-to-day basis other than speculation. I think the market is coming to the realization that adoption just is not here.

XLU Technical Analysis

The next chart is XLU ETF. It is utilities and if we can break above the 47 dollars level, this thing could really start to rip to the upside. That is not really a good thing for the overall health of the markets, but it does look like utilities are really starting to ramp up here and clearing the 47 dollars level could open up a move to the 50 dollars level before it is all said and done.

This is typically a fairly quiet market, but the fact that it is stretching the way it is certainly has caught my attention. If we fall from here, then that probably helps broader indexes in the United States just simply because it means people might be moving into more risk-on appetite positioning.