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Forex

German Dax index tanks 14 points, spooked by Hong Kong and trade war

Squared Direct | Aug. 13, 2019
German Dax index tanks 14 points, spooked by Hong Kong and trade war

German Dax index turned lower on Monday, in a new burst of negative sentiment around US-China trade war, political developments in Argentina and Hong Kong and fears for the global economy.

13 August 2019 | SQUARED DIRECT – The DAX traded 0.12% lower as political tensions in Honk Kong add to the existing angst over US-China trade relations. The bleak global economic outlook has fueled a global bond rally as investors turn to safer assets amidst the geopolitical tensions and trade uncertainty.

Today Germany alongside the Eurozone publishes ZEW economic sentiment figures both of which are estimated to decline to reflect a slowdown in the region. Moreover, the US publishes inflation data which may provide directional cues for the DAX. Apart from the economic data, expect geopolitical and trade headlines to dominate market sentiment and hold greater influence on price action.

Dax index technical analysis

The DAX lost 14 points to end at 11679 on Tuesday. The price tagged the resistance provided by the 50-period MA to record an intraday high of 11835 and proceeded to decline and dip below the 200-day MA at 11658.

Today, look to the 20-period MA at 11730 to provide near-term direction for the DAX, as a sustained move below this level would maintain selling pressure and lead to a break through the 200-day MA and towards the 11600 support level followed by 11550. Alternately a trade above the 50-period MA at 11770 would be required to enable gains towards the resistance at 11840.

Support: 11600/11550
Resistance: 11770 /11840

Chart (4H)

German Dax index tanks 14 points

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