Where Is The Dax Headed Next???
The US and China have been negotiating for months, bring the Equity Markets along for the ride in hopes that a deal will be made. But it’s not only the Equity Markets hoping for a deal. The biggest economy in Europe is also hoping for a deal.
Germany is only expected to grow at a rate of 0.5% this year, according to the latest economic forecasts by the European Commission. It will be the second-worst economy across the EU in terms of growth, just behind Italy.
Germany’s industrial crisis is worsening, the economy is at risk of recession and a raft of mounting troubles mean the chance of a near-term turnaround are fading.
Trade tensions, weaker demand abroad and the travails of the car industry have built up over the past year to take a toll on the engine of Europe’s economy. They’ve dragged manufacturing into its deepest slump in seven years, and some of the nation’s biggest corporate names from BASF SE to Daimler AG and Continental AG have had to come to terms with a new reality for business.
As one of the world’s biggest exporters, Germany is paying a high price for the slowdown in global trade. The economy is forecast to grow the least in six years in 2019.
The question for Germany is how bad the downturn, once expected to be temporary, will become.
This year the DAX has bounced off of the monthly demand at 10400 and no has been hovering in the monthly supply at 12400. However, the bullish monthly candle looks like the DAX once to go higher, which in turn will means breaching the monthly supply zone.
Thus, I will be watching for any signs of weakness for a potential reversal if and only if price closes below the major support/resistance level at 12200.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.