- The DAX 30 is consolidating between last week’s low of 9125 and last week’s high of 9594.
- On a break to the 9125 low the DAX 30 may reach its current yearly low of 8700.
- A breach to last week’s high of 9594 and the DAX 30 may trigger a rally to the January 27 high of 9931
- German unemployment rate and U.S. ISM Manufacturing on deck
The DAX 30 (FXCM: GER30) is consolidating between last week’s low of 9125 and last week’s high of 9594.
With the overall trend being clearly bearish since December, the path of least resistance is on the downside and a break to the 9125 low will align the short-term trend with the multi-month trend. In this scenario, the DAX 30 may reach its current yearly low of 8700. The FXCM SSI index is suggesting the same as 57% of traders are long while 43% are short.
On a breach to last week’s high of 9594, the DAX 30 may reach the January 27 high of 9931, which is also the next resistance in line.
German Unemployment Rate and U.S. ISM Manufacturing
The German unemployment rate is projected to remain unchanged at 6.2% according to a Bloomberg News survey. A better than expected outcome may boost the DAX, however, the heaviest market volatility is expected on the release of U.S. ISM manufacturing this afternoon. A Bloomberg News survey projects a rise to 48.5 from 48.2.
China manufacturing PMI for February fell to 49.0 from 49.4, while the Caixin China manufacturing PMI slid to 48.0 from 48.4 in January. This has so far not impacted the DAX 30 in any major way.
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DAX 30 | FXCM: GER30
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
— Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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