DAX technical analysis D1 | Our expectations:
Medium term short trend, lower highs and deeper bottoms. The current correction gives good opportunity for short positions with a close SL and a good risk/reward ratio.
1,2,3 formation is likely to keep the pair moving south, the price reached the resistance.
Indicators:
Price below 50 and above 200SMA.
Test of 38.2% Fibonacci, the price rebound sharply down.
DeMarker -below 0.3
Fundamental: The bloc's economy is growing at a slow pace in the third quarter of the year. The first signals of a decline in the labor market are being observed. The economic outlook in Germany remains unclear and hangs only on exports. Economic activity may further contract in the summer due to low industrial activity. It is unclear whether exports will remain at a level before the domestic economy becomes more exposed to external risks. Given how things are going, a new shrinking economy is far from surprising.
As has been shared in the past weeks, the dichotomy of the German economy (production and service performance) will eventually fall, and the chances of a negative effect on other sectors will become noticeable every day.
PMI data on Thursday may give us indications of this, but government officials hope the services sector will continue to support the economy during these difficult times.
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