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Beyond data, tariff developments and FOMC commentary remain pivotal. A worsening trade dispute could deepen losses for German exporters. Conversely, any softening in rhetoric may offer the DAX some price support.
Near-Term Outlook
The DAX’s path will depend on central bank policies, economic data, and trade developments:
- Bearish Scenario: Escalating US-EU trade tensions, weaker US economic data, hotter Eurozone inflation, and hawkish central bank rhetoric could push the DAX below 22,000.
- Bullish Scenario: Dovish central bank chatter, easing trade tensions, upbeat US data, and softer Eurozone inflation could drive the DAX toward 23,000.
As of Tuesday morning, US futures pointed to a cautious open, with the Nasdaq 100 mini down 46 points.
DAX Technical Indicators
Daily Chart
A positive open, the DAX sits above the 50-day and 200-day Exponential Moving Averages (EMA), sending bullish price signals.
A breakout above 22,500 could enable the bulls to target 22,750 as the next upside target.
Conversely, a DAX drop below the 50-day EMA would bring 22,000 into play. A break below 22,000 could indicate a fall toward 21,750, opening the door to 21,500.
The 14-day Relative Strength Index (RSI) at 45.66 suggests the DAX could fall toward 21,500 before entering oversold territory (RSI< 30).
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