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Beyond the retail sales report, trade developments and FOMC members’ insights into the Fed’s rate path require consideration.
Near-Term Outlook
The DAX’s performance hinges on German inflation data, US retail sales, and central bank forward guidance.
- Weaker data and more dovish central bank rate signals could push the DAX toward 23,000.
- Strong data and falling bets on central bank rate cuts may pressure rate-sensitive German stocks, potentially dragging the Index toward 22,000.
The DAX is also exposed to US trade policy and geopolitics. Escalating tariffs on EU goods or setbacks in Ukraine peace talks could pressure the Index. Conversely, progress on peace negotiations and constructive US-EU trade talks may drive the DAX to fresh highs.
As of Friday morning, futures indicated a weak start. DAX futures tumbled 117 points, while the Nasdaq 100 mini gained 27 points.
DAX Technical Indicators
Daily Chart
After Thursday’s breakout, the DAX sits well above the 50-day and 200-day Exponential Moving Averages (EMAs). The EMAs affirm bullish price signals.
A breakout above the February 13 record high of 22,625 could signal a move toward 22,750. A break above 22,750 may enable the bulls to target the 23,000.
Conversely, if the DAX drops below 22,500, the 22,350 level will likely come into play.
With the 14-day Relative Strength Index (RSI) at 80.54, the DAX remains in overbought territory (above 70 RSI). Selling pressure could intensify at the record high of 22,625.
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