Technical Analyst, Saxo Bank
GER40 Future/CFD testing key support. 13,000 is key support for DAX. Sellers trying to push it below, buyers lifting it.
As can be seen on the 1 Hour chart GER40 is pushed below, buyers trying to lift it back above. There is Divergence on RSI indicating we could see a rebound. However, if GER40 takes out 12,937 and RSI breaks the rising trend line, a sell off could be fueled.
If buyers succeed in lifting GER40 back above the falling trend line on the 1 hour chart we could see a move to 13,500
If the DAX cash Index closes the day below 13,000 March lows are likely to be tested and possible taken out. At the end of the day the DAX cash Index is where the real interest is
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Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.