DAX Index Eyes Trend Line Support to Start the New Year
The DAX index finished yesterday 88.10 points or 0.66% lower at 13,249.01. Meanwhile, DAX index CFDs dropped like a rock after opening at 13,291.6 to close at 13,120.5.
Gainers and Losers on the DAX Index
Gains on the DAX index were led by Wirecard which posted a 1.13% profit on the last trading day of the year. In second was RWE with a 1.07% uptick. Meanwhile, Deutsche Bank came in third at 0.16%.
On the other hand, Henkel vz led losses at -0.43%. BMW scored the second biggest loss for the day at -0.50%, while Bayer was in the red by 0.55% to round up the top three losers in yesterday’s trading.
Profit-Taking Weighed on the DAX on the Last Trading Day of 2019
Without any market-moving economic report due yesterday, equity investors proceeded to square their positions and take profit on their positions. Yesterday was the last day of trading for 2019 and it only makes sense for investors to re-balance their portfolios ahead of the new year.
US-China Phase One Deal to be Signed This Weekend?
Meanwhile, there are speculations that the US and China could Sign their Phase One deal as early as this weekend. If this turns out to be true, the DAX index could be off to a bullish start in 2020 as this would alleviate uncertainty surrounding the trade war.
On the daily time frame of DAX index CFDs, we can see that the stock index has a little bit of room to trade lower and still maintain its uptrend. Connecting the lows of August 15 and October 7, we can see that support at the rising trend line is somewhere around 13,050.4. This price also seems to coincide with the 23.6% Fib level when you draw the Fibonacci retracement tool from the low of October 2 to the high of December 13. Reversal candles around this level could mean that the DAX index may soon make a run for its all-time highs at 13,550.8.
On the other hand, a strong bearish close below the Fib level could mean that the stock index could fall to 12,487.5 where the 61.8% Fib level and 100 SMA are.