Category: Forex News

DAX Index Today: Eurozone Data and ECB Chatter to Impact the DAX Outlook

Tech stocks continued to rise, with Infineon Technologies and SAP seeing gains of 3.41% and 2.01%, respectively.

Eurozone Industrial Production and the ECB in Focus

On Wednesday, industrial production numbers for the Eurozone will garner investor interest. Economists forecast industrial production to decline by 2.6% in January after rising 2.6% in December.

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Downward trends in consumer prices could see investors show more interest in the service and manufacturing sector data. A weakening macroeconomic environment could support bets on a more dovish ECB rate path for 2024.

Beyond the inflation figures, investors must monitor ECB chatter. ECB Executive Board members Kerstin af Jochnick and Piero Cipollone are on the calendar to speak. Support for an ECB interest rate cut in June would support the buyer appetite for DAX-listed stocks.

However, there are no US economic indicators from the US to consider. The lack of data will leave the US equity markets to influence market risk sentiment late in the European session.

Short-term Forecast

Near-term trends for the DAX will likely hinge on ECB and Fed interest rate cut bets. Softer inflationary pressures could signal multiple rate cuts in H2 2024. However, signals of a marked deterioration in the macroeconomic environment could pressure the DAX.

On Wednesday, the DAX futures and Nasdaq mini were down 20 and 24 points, respectively.

DAX Technical Indicators

Daily Chart

The DAX sat well above the 50-day and 200-day EMAs, sending bullish price signals.

A DAX break above the Tuesday all-time high of 17,973 would support a move to the 18,000 handle.

On Wednesday, Eurozone industrial production and ECB commentary need consideration.

However, a drop below the 17,850 handle would bring sub-17,800 levels into play.

The 14-day RSI at 77.14 shows the DAX in overbought territory. Selling pressure could intensify at the Tuesday high of 17,973.


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