When will DAX30 bulls go for a break of 13,800 points?

February 17, 2020 10:30

Source: Economic Events February 17, 2020 - Admiral Markets' Forex Calendar

Due to the US bank holiday "US President's Day", shortening US trading hours and minimising volatility for the start of the trading week, the chance of any significant moves in the German DAX30 is pretty low.

This is even more likely given the small expiration in Options at the EUREX next Friday.

Here, the Open Interest of Short Calls is quite elevated at 13,800 points, meaning that institutional market participants have an increased interest in holding the German index below 13,800 points, limiting any upside potential.

Nevertheless, if, for whatever reason, we get to see a break above 13,800 points today or in the near future, these institutional players might be forced to hedge their bets, pushing the DAX30 CFD even higher, and bring the next psychological milestone at 14,000 points into focus.

On the other hand: after the surprisingly neutral remarks from Fed chairman Powell last week couldn't bring Equities down, and the Thursday's drop was quickly erased, so it became clear that risk-reward ratios for Short engagements are probably not very attractive either.

That said, we see the DAX30 CFD solidly supported around 13,580/600 points with only a drop lower darkening the technical picture on H1 a bit, activating the region around 13,360/400 as a next target:

Source: Admiral Markets MT5 with MT5-SE Add-on DAX30 CFD Hourly chart (between January 28, 2020, to February 14, 2020). Accessed: February 14, 2020, at 10:00pm GMT

Source: Admiral Markets MT5 with MT5-SE Add-on DAX30 CFD Daily chart (between November 2, 2018, to February 14, 2020). Accessed: February 14, 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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