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DAX Index Forecast: Final Pullback Before New All-Time High?

DAX Index (INDEXDB: DAX) has been one of the best-performing stock indices in 2023. The German blue-chip index has surged by more than 13% this year, outperforming the S&P 500, which is up only 7.2%. The momentum behind the ongoing rally suggests that a new all-time high could just be around the corner, but there is a catch.

On Wednesday, the equities markets turned green ahead of the rate hike decision by the US Fed. The DAX index gained 112 points during today’s trading session. The benchmark US indices S$P 500 index and Nasdaq 100, also opened green.

Analysts Expect The Rate Hikes To Pause Soon

The FOMC meeting in the US will make a decision on a rate hike today. The markets expect the meeting to conclude with another 25 bps rate hike. As the markets are already green before the announcement, it is quite likely that it’s already priced in. Another reason behind the bullishness is the expectation of a policy shift by the US Fed amid a growing banking crisis. This could be a reason behind today’s surge in DAX Index.

Therefore, the markets are anticipating a dovish tone by the US Fed which could also mean a pause in rate hikes very soon. However, if the Fed remains hawkish in its statement today, then a sell-off in the traditional markets could be just around the corner.

DAX Targets New All-Time High In 2023

The market structure of INDEXDB: DAX is looking very bullish as the German benchmark index aims new all-time high. The index broke above 16000 points this week, which was the first time since January 2022. However, DAX couldn’t gain strength above this level and had a slight pullback.

At the time of writing, the index stands at 15820 points which is around 500 points below its all-time high. My DAX Index forecast will remain bullish as long as the index remains above 15000 points. The market sentiment in the US will play a key role in this regard.

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DAX Index