Earlier today, the DAX Index slid below the July 18 low of 12194.8 as the Lufthansa and Bayer quarterly earnings disappointed investors. The slide below the July low has triggered an end to the short-term upward trend and there is now an increased risk that the DAX index trades near the May 13 low before finding support inline with the longer-term trend. Alternatively, if the index manages to close the day above the July 18 low, we might see a short-squeeze tomorrow, especially if US stock markets bounce.
My preference is to give the index a few days to figure out the intention of investors. For the short-term downtrend to end the price would probably need to trade above Monday’s high of 12470.Don’t miss a beat! Follow us on Twitter.