Dax Forecast: Resilient After Volatile Week

• The German DAX has seen a bit of stability during the trading session on Friday, as we have seen the market go both up and down, but we also see the market hang around the crucial 200 Day EMA.
• For what it is worth, stock indices around the world had at least a somewhat stable day during the trading session on Friday, so I think you’ve got a situation where you might start to see the beginning of something somewhat positive.

At this point in time, I think the most positive thing that you can see is the market going sideways for a while, because it shows that traders are more likely than not going to continue to at least contemplate the idea of getting involved in equities. Obviously, there has been a lot of damage done to financial markets around the world, as tariffs will certainly play havoc with what companies can expect. Furthermore, there are a lot of questions about whether or not there will be some type of financial engineering as far as central banks are concerned, and it is worth noting that the Federal Reserve did state something to the effect of that I was willing to step into the market and stabilize things if they get out of control.

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Technical Analysis

Technical analysis for this market is interesting, as we are hanging around the crucial 200 Day EMA, an area that a lot of people will be paying close attention to. The €20,000 level is an area that a lot of people will be paying attention to, as it is a large, round, psychologically significant figure, and an area where a lot of options trades are probably being executed.

Because of this, and the fact that we ended up forming a bit of a hammer during the trading session on Friday does suggest that we could continue to go higher, but we never know what’s going to happen over the weekend, so some of what we are seeing could be simple short covering ahead of what could be a very volatile couple of days without any chance to react to it.

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