Trump gets Coronavirus, DAX30 under pressure
The German DAX30 found itself in a trading range between 12,700 and 12,900 points for most of last week after a bullish run last week on Monday.
A break below the "make-or-break" level on the downside was initiated last Friday, potentially driven by the news that US President Trump got Coronavirus, resulting in uncertainty among market participants.
Technically, the drop is clearly a bearish sign, potentially levelling the path down to 12,200 points with a stop-over at around 12,450/470 points.
At around 12,200 points we find the SMA(200) on a daily time-frame. Therefore, it is a key level that could, if broken, add further fuel.
In addition to the technical side:
- There is a known bearish seasonality in October in US presidential election years (usually October is a bullish month for Equities)
- There is also very low volatility in bond markets (currently, interest rate volatility is at an all-time low; in the past, such low volatility was usually followed by a sharp push higher with a sell-off of stocks)
The risk-reward ratio for short-term and mid-term Short engagements seems to be more attractive than for Long engagements.
Short-term our bearish outlook will brighten if bulls can sustainably recapture 12,850/900 points:
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 in five years, it was up by 34.2%.
Check out Admiral Markets' most competitive conditions on the DAX30 CFD and start trading on the DAX30 CFD with a low 0.8 point spread offering during the main Xetra trading hours.
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