[ad_1]
Fed Speakers in Focus
In the May 21 US session, investors should monitor Fed speeches. Their insights into inflation, the labor market, and monetary policy require consideration. Calls to delay rate cuts to assess the impact of tariffs may pressure risk assets, including German-listed stocks. However, rising support for a Q3 Fed rate cut to bolster the US labor market could boost risk sentiment.
Beyond the data, trade developments remain a key driver for risk appetite, particularly for the DAX.
DAX Outlook: Trade and Central Banks to Dictate Trends
The DAX’s near-term trajectory hinges on trade developments, economic data, and central bank cues.
- Bullish Case: Easing trade tensions, upbeat data, and dovish central bank signals could send the DAX toward 24,500
- Bearish Case: Renewed trade tensions, weak data, or hawkish central bank rhetoric could push the DAX toward 23,500.
As of Wednesday morning, the DAX futures were up by 17 points, while the Nasdaq 100 mini dropped 72 points, suggesting a choppy mid-week session.
Technical Setup Suggests Cautious Optimism
After Tuesday’s gains, the DAX trades well above the 50-day and the 200-day Exponential Moving Averages (EMA), indicating bullish momentum.
- Upside Target: A break above the May 20 high of 24,083 could signal a move toward 24,150. A sustained move through 24,150 may bring 24,350 into play.
- Downside risk: A break below 24,000 could enable the bears to target 23,750, with 23,500 as the next key support.
The 14-day Relative Strength Index (RSI) at 71.02 shows the DAX sitting in overbought territory (RSI > 70). Selling pressure may intensify at the record high of 24,083.
[ad_2]
