The DAX in Germany has struggle a little bit on Thursday, as traders are taking profit after a big move in general.
However, there are plenty of headline risks out there as well.
The German DAX has seen a bit of selling as we find ourselves now below the 200-day EMA again.
All things being equal, the 50-day EMA sitting just below near the 23,620 level is offering a bit of support. The markets will continue to see a lot of choppiness and noise in general, but I also recognize that market participants should continue to see a lot of headline risk out there with interest rates, of course driving a lot of where risk appetite is going around the world.
Headline Risk and Economic Growth
The primary headwind for the DAX at the moment would be tariffs and of course geopolitics, but energy as well. It will be interesting to see how that plays out because the interest rates in places like Germany and America have been rising for some time and you also have to keep in mind that the market also has to price in the idea of Germany growing by 1.1% maybe to 1.2%.
So, the question is: is it a recovery or is it a bit of stagnation? You could make an argument for, quite frankly.
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Pullbacks at this point I do think end up being buying opportunities with technology remaining pretty strongly performing with SAP being a big winner there. Deutsche Bank in Financials has done well and BASF is starting to show signs of improvement recently in the industrial sector.
So, all things being equal I think we are in the midst of turning this ship around, perhaps trying to get to 25,000 but be aware that it could be derailed by a Middle Eastern headline.
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