DAX around critical support of 19,000

DAX around critical support of 19.000

Fears regarding a decelerating US economy have been temporarily alleviated after Friday's payroll report that exceeded forecasts. The optimistic sentiment spilled across into Asia overnight, supporting the dollar and lifting markets on Friday. The markets see a hold as a remote option, despite the fact that a 25 bps decrease is still the most likely outcome of the upcoming Fed meeting. As the world waits for an Israeli reaction to last week's attacks in Iran, oil prices continue to rise following their highest week in over a year. The postponement implies further discussions between Washington and Tel Aviv; a strictly military attack that shuns nuclear and oil assets would cause Brent and WTI to retreat. Throughout the week, there will be Fed speakers, and they might use Friday's report as an opportunity to emphasize that the Fed is not in a rush to loosen policy.

Germany 40 (DAX) Technical analysis

Despite the fact that September is regarded as a bad month for the stock market, the market fared well against this seasonality. Following a lackluster initial week, the Germany 40 experienced a significant surge, surpassing the previous record high of 18,990 points. Following the breakout, it increased rapidly by an additional 490 points, bringing the Germany 40 to a new all-time high of 19,490 points. There are indications of a fresh consolidation until the end of the month, with a significant support level located between 19,000 and 18,830 points. The index should rise back up to 19,490 and eventually 20,000 if the recovery holds. There is a chance of a fresh drop towards 18,200, though, if Germany 40 drops below 18,670.

19,000 and 18,830 gives us support.

19,250 and 19,490 points are resistance

The RSI is in slight bullish territories.

The Stochastic RSI is slightly above oversold levels, with the fast moving line below.

On the agenda today (GMT +1):

11:00 – EU - Eurogroup Meetings

15:30 – DE - German Buba President Nagel Speaks 

18:00 – US - FOMC Member Bowman Speaks 

18:50 – US - FOMC Member Kashkari Speaks 

20:00 – US - Consumer Credit (Aug)

23:00 – US - FOMC Member Bostic Speaks