Dax index trade in cautious mode early Friday, following sharp yesterday’s losses after better than expected earnings reports from major US tech companies such as Apple, Amazon, and Google.
Dax yesterday slumped to the lowest level for July after the announcement that German GDP contracted by 10.1% the worst contraction in records. Analysts were looking for a contraction of -9%. The yearly reading came down to -11.7% also below the forecasts of -11.7%.
However, today the Germany Retail Sales beat the expectations. June retail sales dropped 1.6% better than the market consensus estimates for a drop -3.3%. The yearly reading for the Retail Sales came in at 5.9% also beating the forecasts of 3%.
Among the best performers in Dax, today are Infineon adding 2.22% at 21.44, Vonovia +1.89% at 56.08, SAP +1.24% at 135.18 and Deutsche Bank adding 1.33% at 7.67. On the other hand, the bottom performers are Covestro, Daimler and Basf, which gives up 0.50% at 47.48.
Dax Index Breaks Below the Rising Channel
Dax index is 0.64% higher at 12,455, as the index attempts a rebound above the 50-day moving average. Yesterday the index in a perfect technical move after the sharp drop managed to bounce exactly from the 200-day moving average support. The index accelerated the decline after it breached the ascending trend line that supported the index since the March lows.
Today the fight will be around the 50-day moving average. Bulls managed to reverse the morning loses and regained that spot. Now the intraday resistance stands at 12,494 the daily top. The next hurdle would be yesterday’s high at 12,774.
On the other side, bearish traders would like a close below 12,379 the daily low. A break below the critical 200-day moving average at 12,208 would attract more bears in action. The next support stands at 11.590 the low from June 15.