DAX 30 Under Pressure On BoJ Inactivity
- The DAX 30 (CFD: GER30) maintained a short-term bearish bias at the time of writing. The monthly trend is also under pressure.
- The decline to the DAX is on the heels of BoJ surprising the markets by not expanding their monetary stimulus.
- As the U.S. trading session starts focus shifts to U.S. GDP and Jobless claims.
The DAX 30 (CFD: GER30) maintained a bearish bias at the time of writing. The trend was short-term bearish as yesterday’s high of 10,346 is lower than last week’s high of 10,488. We have been highlighting this trend over the last few days.
The April 14 high of 10,110 is now in play as a potential support level and is the same level which held as resistance for most of March. Below the April 14 high the psychological level of 10,000 will come in focus. Resistance levels are yesterday’s high of 10,346, followed by the April 22 closing level of 10,409.
We note that the longer-term trend is now under pressure as the price has now lost 61.8% of its gains from last week’s low of 9906. Last week’s low of 9906 is crucial for the bullish trend in place since price bottomed out on April 7, as it is the last swing low on the daily chart. Below it, the next major support level is the April 7 low of 9437.
The decline to the DAX is on the heels of BoJ surprising the markets by not expanding their monetary stimulus, the Japanese Yen and stock markets declined as a result of the meeting outcome.
The German Unemployment Rate remained unchanged at 6.2% and therefore matched economists’ expectations. The DAX 30 rose slightly on the news, but five minutes after the release it resumed its tumble. German CPI will follow in the afternoon. A Bloomberg News survey projects the inflation rate to rise by 0.1% YoY, which would be a step back from the 0.3% rise in March. The report is important as it influences the monetary policy of the ECB, which in turns affects economic growth in the Eurozone and Germany. As the U.S. trading session starts, focus shifts to U.S. GDP and Jobless claims.
DAX 30 | CFD: GER30
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano�
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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