Will the DAX sustain its uptrend in the face of deflationary pre
European assets started in positive territory on Monday, led by the German DAX (Ticker AT: GER40), following positive production data from the eurozone's strongest economy at the end of last week. The start of the week is not going to stop this trend despite the fact that the imports vs. exports data reflect a negative trade balance, with lower than expected export volumes, being EUR 25.5 billion against EUR 21.4 billion published. In addition, before noon the bonds of several countries in the Euro zone, including Germany, will be drawn.
If we analyze the German economy, the slowdown in sales within its main consumers is palpable, so although the index shows an upward trend, this bullish endurance does not seem to last in the long term, given the high dependence of the German market on exports. It is also important to take into account the ongoing investigations of President Von der Legen in relation to the implications of possible vaccine-related profiteering and the misallocation of capital in this case. Depending on the evolution of this case, it could affect several European companies, especially Pfizer, which is listed in this index. However, the impact could extend to the entire European pharmaceutical sector.
Looking at the chart, within this uptrend of the index started at the end of October last year, since mid-March of this year it has been building price in a range between 18,603.47 points and 17,879.10 points, being the current evolution zone 18,229.76 points and 17,879.10 points marked in the box. Looking at the price bell, the most traded zone of the control point is 17991.06 points. The RSI indicator confirms that the price is slightly overbought at 65.79% with the 200 candlestick average much more subdued almost neutral at 52.83%. So it is to be expected that at the moment that there is news of impact the index will look for the highs zone and if it does not pierce as it happened on April 2, we will see a pullback in the direction of the lower part of the range, which is approaching in proximity with the price of the Control Point.
Ion Jauregui - AT Analyst
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
If we analyze the German economy, the slowdown in sales within its main consumers is palpable, so although the index shows an upward trend, this bullish endurance does not seem to last in the long term, given the high dependence of the German market on exports. It is also important to take into account the ongoing investigations of President Von der Legen in relation to the implications of possible vaccine-related profiteering and the misallocation of capital in this case. Depending on the evolution of this case, it could affect several European companies, especially Pfizer, which is listed in this index. However, the impact could extend to the entire European pharmaceutical sector.
Looking at the chart, within this uptrend of the index started at the end of October last year, since mid-March of this year it has been building price in a range between 18,603.47 points and 17,879.10 points, being the current evolution zone 18,229.76 points and 17,879.10 points marked in the box. Looking at the price bell, the most traded zone of the control point is 17991.06 points. The RSI indicator confirms that the price is slightly overbought at 65.79% with the 200 candlestick average much more subdued almost neutral at 52.83%. So it is to be expected that at the moment that there is news of impact the index will look for the highs zone and if it does not pierce as it happened on April 2, we will see a pullback in the direction of the lower part of the range, which is approaching in proximity with the price of the Control Point.
Ion Jauregui - AT Analyst
*******************************************************************************************
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.