The German markets went back and forth during the trading session on Wednesday, as we continue to bounce around between the €13,000 level on the bottom, and the €13,125 level above. Overall, I believe that a break above the €13,125 level should send this market towards the €13,300 level above. I believe that the market should continue to go much higher, as the €13,000 level is acting as a “hard floor” in the market. Given enough time, we should probably go to the €13,500 level after that, and then possibly even the €15,000 level after that. A lot of the volatility is due to the lack of volume, so keep that in mind but I think that once the traders come back from holiday, it’s likely that the buying will continue.
I believe that every time we pull back, it should be a buying opportunity as it offers value. I believe that the large money managers will come back into the marketplace after New Year’s Day, and start buying the DAX as it has offered so much in the way of support just below. Beyond that, Germany is without a doubt the strongest economy in the European Union, and therefore this is the first-place money goes to when looking to invest in the EU.
In general, I think that the support he sends out to the €12,800 level, but if we were to break down below there it’s likely that we will find even more support at the €12,500 level, but I suspect this is the least likely of scenarios to play out over the next couple of weeks. Short-term traders, play the nice consolidation area that we have.
DAX Video 28.12.17
This article was originally posted on FX Empire