All sectors of the DAX 30 are lower today. The biggest losses can be found in the Utilities sector (e.g. E.ON), followed by Consumer, Cyclicals (e.g. Continental). The trigger for a lower DAX 30 is commodity prices, with crude oil sliding to a new multi-year low as an example.

From a technical point of view, I will treat the DAX 30 as bearish below the psychological level of 10,000 (yesterday’s high was at 9,944). The trend is bearish as yesterday’s high of 9,944 is lower than this week’s high of 10,163, along with price also having created a new weekly low in yesterday’s session. I would expect price to reach the psychological level of 9500 (a level highlighted over the last few days).

Bearish traders not already short will most likely wait for a pullback to the range of 9800 to 9942 to enter short. They do this as the risk/reward ratio favours shorter positions in this zone. A break to yesterday’s low of 9,966 is expected to trigger an acceleration of the bearish trend.

There are several data releases which may limit or boost the slide of the DAX 30.

Focus will be placed on Industrial Production as it’s this sector which is soft in the U.S. economy, while U.S Retail Sales is where we find its strength. U.S. PPI is interesting as it will show whether the Fed needs to hike rates early or whether to delay. Other data such as Michigan Consumer Confidence is also on deck. 

DAX 30 | FXCM: GER30

Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano