Anticipate choppy behavior, but eventually there will be momentum that picks up this market and send it much higher.
The DAX Index fell initially during the trading session on Wednesday but found enough support near the 50-day EMA to show signs of support again. With this being the case, it is very likely that we will continue to see buyers in this general vicinity, so if we can break above the top of the candlestick from Tuesday, then it is very possible that we will see this market go much higher. With that, I would anticipate a move towards the 15,800 level, which was the most recent high.
Breaking above the most recent high then allows this market to go looking towards much higher levels, the first one being the 16,000 level. This makes sense, considering that the markets do tend to respect these big figures, and the DAX will quite often pay close attention to these 1000-point increments. Keep in mind that the DAX is highly influential for the European Union as well, and as the economic situation in Europe seems to be getting a bit better, it makes sense that the first place that people throw money at is Germany. Furthermore, if the world continues its reopening trade, then it makes sense that Germany would be a major benefactor as it is such a huge exporter of industrial goods.
If we do break down from here, then the 15,000 level should be the “floor in the market”, and as a result I would anticipate that a lot of people would be looking to get involved there. If we do break down below the 15,000 level it could send the DAX a bit lower. I think at that point in time though, you would see a lot of negativity around the world when it comes to stock markets, most certainly in the European Union, as the DAX is the leader. If that happens, then I anticipate that other indices such as the CAC and the IBEX would get absolutely crushed. Nonetheless, I believe that there are plenty of people looking to get involved in picking up this market going forward. Anticipate choppy behavior, but eventually there will be momentum that picks up this market and send it much higher.