The DAX in Germany has risen a little bit on Tuesday, as headlines have suggested that the Iranians and Americans could be talking again soon. Interest rates falling also seems to help.
DAX
The DAX in Germany has risen a little bit during the trading session on Tuesday to continue the massive swing that we had seen on Monday after it was announced that perhaps the Iranians and the Americans will be speaking again in the next couple of days, opening up the possibility of some type of agreement.
Keep in mind that Germany is highly sensitive to what's going on in the Middle East as energy is a major problem for its large industrial base, such as BASF, and its automotive construction and other sectors as well. Energy being abundant is a necessity for the German economy to continue to power the rest of Europe.
Energy Necessity and Key Technical Levels
If the industrial base has to search for energy or if the input of energy remains extraordinarily high, that is very bad news for the DAX. That is exactly why we have rallied. For what it's worth, the US 10-year yield is starting to drop as well, so while not a direct correlation to the DAX, it gives you an idea as to what traders are paying attention to and right now, they're looking a little bit more optimistic.
If we can break above the 24,250 level, then I think the DAX eventually finds its way back to the 25,000 level. Short-term pullbacks should be buying opportunities, unless we get some type of massive spike in interest rates in the United States and Germany or some type of headline that rattles the markets, which let's face it, could happen very easily in either the Middle East or talk about more tariffs from the.