The DAX index has suffered its 3rd largest daily drop of 2020 after the German government announced a partial national lockdown to commence from November 2, according to information obtained from Reuters and the Bild newspaper. Bars and restaurants will shut from that date, and only shops that could maintain a distance of one person be square metre would be allowed to remain open.
InvestingCube's S&R Levels
In Buy Zone
German Chancellor Angela Merkel indicated on Wednesday that the country was in a “very serious” coronavirus situation, with a doubling of the number of patients admitted into intensive care in the last 10 days. Reuters reported her comments, including one where she indicated that the government’s patient tracking capacity in many areas had been overwhelmed.
The DAX is down by 4.17% on the day, having touched off intraday lows at 11457.12.
Technical Outlook for DAX Index
The collapse of the DAX on Wednesday has violated the 11713.074 support level by at least 3%. The daily candle needs to close below this support with this penetration distance to confirm the breakout. This opens the door towards the May 26 low at 11432.68, which is close to today’s intraday low. 11044.72 is the next target for sellers if 11432.68 is breached.
On the flip side, a recovery mover targets 11960.52 and 11995.83; both targets located to the north of the immediate support-turned-resistance at 11713.07.