DAX PERFORMANCE-INDEX (.GDAXI) struggles to hold onto record territory

DAX PERFORMANCE-INDEX (.GDAXI) struggles to hold onto record territory

DAX PERFORMANCE-INDEX (.GDAXI) struggles to hold onto record territory

German stocks had a slippery hold on record territory Wednesday, as equities across Europe struggled to make gains amid lingering concerns over the spread of China’s coronavirus.

The German DAX 30 index (DX:DAX) pushed into record territory earlier in the day, rising to a high of 13,640.06, before turning flat to trade at 13,550.79. Bucking losses across Europe on Tuesday, the index rose 0.05% to finish just barely off a January 23, 2018 record close of 13,559.60. It’ll need another positive push to cement a fresh high on Wednesday.

The Stoxx Europe 600 index (XX:SXXP) was flat at 423.60, after slipping 0.1% on Tuesday. The French CAC 40 index (FR:PX1) was also flat at 6,042.50, while the FTSE 100 index (UK:UKX) slipped 0.3% to 7,590.49.

Investors are keeping a close eye on developments surrounding China’s coronavirus, which has killed nine people and infected hundreds, and as the U.S. reported its first case on Tuesday. Market jitters could return if the World Health Organization labels the virus a global health emergency after its meeting on Wednesday, raising fears of a pandemic that could slow economic growth.

U.S. stock futures indicated a positive start for Wall Street after coronavirus concerns helped drag benchmark indexes lower on Tuesday.

Data showed French manufacturing sector sentiment rose in January, a day after German Ifo economic expectations reached their highest level since 2015.

Among companies on the move, ASML Holding(NL:ASML) announced a higher profit for the fourth quarter of 2019 and a three-year share-buyback program of up to 6 billion euros ($6.66 billion). But the memory-chip maker’s first-quarter gross margin forecast was sharply below expectations, noted analysts at ING. Shares slipped 1.2%.

Shares of Daimler (DE:DAI) fell 1.7% after the automobile maker said earnings almost halved last year and said it would book additional expenses of up to 1.5 billion euros related to Mercedes-Benz’s diesel issue. “Bottom line: the balance sheet pressure clearly means risks to dividends and although not our base case this could necessitate a capital raise,” said Citi analysts in a note to clients.

Shares of Burberry Group (UK:BRBY) fell 2.5%. In a trading statement, the luxury fashion retailer lifted its full-year revenue guidance after same-store sales rose 3% in the third quarter. But it said Asia Pacific sales rose by a low single-digit percentage as Hong Kong sales halved.

British multinational enterprise software company Sage Group (UK:SGE) reported strong trading in the first quarter of fiscal 2020 and backed its fiscal year 2020 guidance. Shares jumped 4%.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 13,646.66.

The projected lower bound is: 13,134.14.

The projected closing price is: 13,390.40.

Candlesticks

A black body occurred (because prices closed lower 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 falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 3 falling windows in the last 50 candles–this makes the current falling window even more bearish.

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 45.0253. This is not an overbought or oversold reading. The last signal was a sell 1 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 51.64. 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 sell 46 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 1. This is not a topping or bottoming area. The last signal was a sell 3 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 sell 0 period(s) ago.

Rex Takasugi – TD Profile

XETRA DAX PF closed down -127.330 at 13,388.420. Volume was 15% above average (neutral) and Bollinger Bands were 30% narrower than normal.

Open     High      Low     Close     Volume___
13,455.90013,486.14013,382.23013,388.420 90,749,928
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 13,478.82 13,270.87 12,485.66
Volatility: 8 12 16
Volume: 69,909,968 74,415,912 85,079,328

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 down today (bearish) 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 7.2% above its 200-period moving average and is in an upward trend. Volatility is relatively normal 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 bullish on .GDAXI and have had this outlook for the last 11 periods.

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