I would expect a general upward move, but obviously very choppy.
The DAX has rallied a bit during the course of the trading session on Wednesday as we continue to mumble back and forth just above the 15,800 level. Ultimately, this is an area that is trying to build up enough momentum to break to the upside, perhaps reaching above the 16,000 level. Breaking above the 16,000 level would of course allow the market to continue to go much higher, perhaps reaching towards the 16,500 level.
Underneath, the 15,800 level is the previous resistance level, at least as far as the previous consolidation level has been dancing around. The 50 day EMA sits at the 15,600 level, as it is turning higher. The 50 day EMA is eventually going to go looking towards the 15,800 level, and therefore I think it is going to offer quite a bit of support as you would expect, and now it is likely that we are going to see even more pressure do to that moving average. The DAX of course is one of the stalwarts of the European Union, as is considered to be the “blue-chip index” for the region, as Germany is by far the strongest economy.
The DAX is also supported by exports, so as the Euro continues to lose strength, which will also help the DAX go higher as those exports become much more viable. Keep in mind that the market will be paying close attention to the global growth story, which of course the DAX is a major beneficiary of. If we start to see more risk out there, then it is possible that the dance could pull back, and a move below the 50 day EMA almost certainly send this market looking towards the 15,000 level. The 15,000 level is currently being tracked by the 200 day EMA, which is rapidly getting there.
I would expect a general upward move, but obviously very choppy. The choppy behavior will continue to be the mainstay of trading between now and the end of the month, as quite frankly a lot of the volume is very late this time of year anyway. With this, look for value and then take advantage of it as I believe we will eventually go to the upside and reaching towards fresh new highs as the DAX is also considered to be a little bit of a safety play if you have to be in equities.