The DAX has been hit hard over the course of August thus far, with German stocks on the back foot once again today. Despite being the traditional powerhouse of Europe, Germany appears to be struggling in terms of both economic output and above-target inflation. The latest German industrial production reading served to exemplify the troubles in Germany at the moment with a contraction of 1.5% in June representing the third significant monthly decline this year.
Nonetheless, the DAX remains within an uptrend that has dominated 2023 thus far. The daily timeframe highlights exactly that, with the pullback seen over the past week bringing price into the confluence of the 76.4% Fibonacci retracement level, and ascending trend line. With that in mind, a potential bullish reversal could come into play here for the index. The break into record highs last Monday does highlight innate strength that could easily swiftly return. Today's concerns around Chinese imports do particularly hold sway in Germany, but the diminished inflation levels do signal a high likeliness for further accommodative action from the PBoC and Chinese government.
Keep an eye out for a potential bullish reversal here for the DAX with a break below the prior swing low of 15447 required to bring an end to the bullish trend that has dominated the past year.
Nonetheless, the DAX remains within an uptrend that has dominated 2023 thus far. The daily timeframe highlights exactly that, with the pullback seen over the past week bringing price into the confluence of the 76.4% Fibonacci retracement level, and ascending trend line. With that in mind, a potential bullish reversal could come into play here for the index. The break into record highs last Monday does highlight innate strength that could easily swiftly return. Today's concerns around Chinese imports do particularly hold sway in Germany, but the diminished inflation levels do signal a high likeliness for further accommodative action from the PBoC and Chinese government.
Keep an eye out for a potential bullish reversal here for the DAX with a break below the prior swing low of 15447 required to bring an end to the bullish trend that has dominated the past year.