Dax index trading higher in a cautious mood ahead of the Jerome Powell speech in Jackson Hole. Speculation that the German government is planning a new relief package helps stocks.
In Jackson Hole, analysts will look for fresh clues on what the Fed will do to increase the inflation and what that will mean for the monetary policy. Fed will keep its accommodative policy until inflation and employment strengthens. FOMC has warned in the last monetary policy meeting that the coronavirus crisis weighing on the economy and threatens the medium-term U.S. economic outlook.
Positive momentum around the globe supported by the developments in the coronavirus treatment and the improvement in trade relations between the two superpowers USA and China.
Yesterday, Germany IFO business surveys beat the expectations. The Business Climate index registered in at 92.6. The Current Assessment index came in at 87.9. Ifo now expects German GDP to grow by 7% in the 3Q.
Dax Index Analysis
Dax index is 0.61% higher at 13,141 with bulls in the driver’s seat. A short correction the previous week stalled at the 50-day moving average.
Resistance for the Dax index stands at 13,146 today’s high. A break above might challenge 13,233 the high from yesterday’s trading session. The next supply zone for the index would be met at 13,315, the high from July 21.
On the flip side, minor support for Dax is at 13,010 the daily low. More robust support awaits at 12,924 the low from August 24. If the bears break that support more bids might emerge at 12,694 the 50-day moving average.