Will the DAX bulls hold the German index above 13,000 points?
Source: Economic Events February 3, 2020 - Admiral Markets' Forex Calendar
The DAX30 CFD has seen a weak weekly close driven by the latest news and developments on the Coronavirus. The resulting risk-off among market participants directs out focus onto the psychologically relevant level of 13,000 points.
Technically, the DAX developed a sequence of falling highs and lows after breaking below the import region of support on the Hourly chart around 13,380/400 points on Monday of last week.
After failing to recapture this region last Wednesday/Thursday after the Fed and despite market participants expecting a dovish Fed, allowing speculations to rise that the central bank will cut rates at least once in 2020 by 25 basis points with a likelihood of over 80%, gives the weak weekly close a clear sign of weakness.
If we get to see a sustainable drop below 13,000 points, the daily trend support around 12,900 points will get our attention.
A drop below that level darkens the technical picture further, then making a test of the SMA(200) and thus further losses down to min 12,500 points a possibility.
If bulls, on the other hand, regain control, a push back above 13,300 points brightens the picture again, switching the technical mode from bearish to at least neutral:
Source: Admiral Markets MT5 with MT5-SE Add-on DAX30 CFD Daily chart (between October 19, 2018, to January 31, 2020). Accessed: January 31, 2020, at 10:00pm GMT - Please note: Past performance is not a reliable indicator of future results, or future performance.
In 2015, the value of the DAX30 CFD increased by 9.56%, in 2016, it increased by 6.87%, in 2017, it increased by 12.51%, in 2018, it fell by 18.26%, in 2019, it increased by 26.44% meaning that after five years, it was up by 34.2%.
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