Home Forex Markets German DAX40 index analysis: 12500 or bottom, the European Central Bank interest rate decision will still test European stocks

German DAX40 index analysis: 12500 or bottom, the European Central Bank interest rate decision will still test European stocks

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German DAX40 index analysis: 12500 or bottom, the European Central Bank interest rate decision will still test European stocks

The German DAX40 index has stopped falling at a low of 12,500 three times. With the boost of US stocks, there are signs of accelerated inflow of European stocks. The market will also usher in the European Central Bank’s interest rate decision on Thursday. Whether it can stand at 13,000 will be the German index will continue to rebound. important reference.

In June, the German DAX40 index experienced a continuous decline from 14800-12500, which was mainly due to the Fed’s interest rate hike expectations triggered by high inflation in the United States and investors’ recession worries about the European political and economic prospects. Risk aversion became the dominant force. Into July, the trend of the German index repeatedly tested the low of 12,500. With the false break, buying has re-emerged.

The shift in market sentiment is related to a rebound in U.S. stocks fueled by U.S. earnings reports, while investor expectations for a sharp fourth-quarter rate hike by the Federal Reserve have weakened, as this will hurt the economy, and U.S. inflation has peaked and the dollar has weakened. sold out.

In addition, the German index triple bottom also attracted short-term buying.

12500 is the reference price as the low point in early May. Once it falls below, it will trigger more selling, and the technical trend plays a role here. With the second false break, the buying gradually increased its strength, and the index began to rise. Above 13000-13400 is still the key resistance. If it can break through 13400, it will help the German index to establish a triple bottom of 12500, and then march towards 14000. It is worth noting that at present, the overall shock of the German index is still downward, until it reaches 13400, which will help ease the decline.

Next, pay attention to the ECB’s interest rate decision on Thursday. The market expects the ECB to raise interest rates slightly, because high oil prices and the weak European economy limit the possibility of aggressive interest rate hikes by the ECB. Before the European economic data shows more signs of recession, it is relatively loose. The monetary policy is conducive to the continued rebound in the stock market.

Pay attention to the performance of the European Central Bank’s interest rate and more economic data, which will affect the market’s judgment on the European stock market.

(Arthur) Follow me on Twitter @ArthurZ22426704

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