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DAX PERFORMANCE-INDEX (.GDAXI) – European Stocks Advance Most in Two Weeks on Easing Virus Toll

DAX PERFORMANCE-INDEX (.GDAXI) – European Stocks Advance Most in Two Weeks on Easing Virus Toll

European equities gained the most in nearly two weeks after reported death tolls from the coronavirus showed signs of easing in several hot spots of the health crisis.

The Stoxx Europe 600 Index closed 3.7% higher, as automakers and travel and leisure shares led a broad rally in sectors. Energy shares underperformed as oil gave up some of last week’s gains amid uncertainty over a deal to end the crude price war, while defensive shares also lagged. The benchmark index has recouped about a quarter of the losses seen since Feb. 19.

U.K. deaths slowed for a second day, while Germany and Spain reported lower numbers of new cases, and fatalities in the state of New York fell for the first time two weeks. The economic impact of the pandemic on corporates is becoming more apparent as more firms lower their guidance and suspend dividends.

“Investors are focusing on the optimism that there’s a stabilization in the rate of deaths from the virus and on the first-quarter reporting season where they hope to get more visibility,” said Ulrich Urbahn, head of multi-asset strategy and research at Joh Berenberg Gossler & Co. “In the long term, there are many reasons not to be too pessimistic: in addition to the massive stimulus measures and the enormous relative attractiveness of equities, the dry powder of many investors — the holdings in money-market funds — have reached a record level.”

Europe’s main stock benchmark has climbed about 19% since an intraday low on March 16, while Germany’s DAX Index has advanced about 22% in the period.

Despite the market’s rebound since the mid-March trough, Citigroup Inc. strategists remain cautious on the outlook for stocks, keeping a defensive sector allocation. “We expect global EPS (earnings-per-share) to fall by around 50% in 2020, which is probably not yet reflected in equity markets,” strategists led by Robert Buckland wrote in a note.

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

The projected upper bound is: 11,039.61.

The projected lower bound is: 8,985.55.

The projected closing price is: 10,012.58.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 6 rising windows in the last 50 candles–this makes the current rising window even more bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 50.9283. This is not an overbought or oversold reading. The last signal was a sell 5 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 47.68. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 9 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 94. This is not a topping or bottoming area. The last signal was a buy 12 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 9 period(s) ago.

Rex Takasugi – TD Profile

XETRA DAX PF closed up 549.400 at 10,075.170. Volume was 4% above average (neutral) and Bollinger Bands were 35% wider than normal.

Open     High      Low     Close     Volume___
9,889.03010,097.3109,841.49010,075.170 126,692,168
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 9,767.66 11,577.78 12,366.85
Volatility: 76 65 36
Volume: 152,777,312 158,916,656 101,169,416

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

XETRA DAX PF gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
XETRA DAX PF is currently 18.5% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .GDAXI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .GDAXI and have had this outlook for the last 29 periods.

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