Dax index fell sharply on Monday morning as the coronavirus spread weigh on investors sentiment. Now there is over 2700 confirmed coronavirus cases while the death toll rises to 80. Dax index is 1.71% lower at 13,343 as traders dump risky assets and buy safe-haven assets. Deutsche Lufthansa AG gets a hit on the chin as the stock gives up 4.12% at 13.83.
On the economic data, the Germany January Ifo business climate index came in at 95.9 below the expectations of 97.0. The IFO, Current Assessment came in at 99.1, also below the forecasts of 99.2. The IFO institute now expects the German GDP to grow by 0.2% in the first quarter of 2020. The German industrial sector is slowly emerging from the crisis. The coronavirus has not yet had any impact on the German economy.
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Dax Index Technical Outlook
Dax index feels the pressure as investors shift to safe-haven assets amid the coronavirus outbreak. On Friday the index managed to recover all of the previous days sharply losses. Today the correction continues and the index approaches the 50-day moving average.
Dax started the trading session with a gap down and now the intraday support stands at 13321 the daily low. A settlement below might test the next critical support at 13280 the 50-day moving average. A break below would cancel the positive momentum and lower levels will be on target. The low from January 8th at 13110 would be the next support level.
On the upside, initial resistance for the Dax index stands at 13,399 today’s high. Friday’s high at 13604 is the next hurdle. Above that, the record high at 13,642 is the next strong supply zone.
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