(MENAFN- Daily Forex)
The DAX has risen again during the trading session on Thursday as we continue to see a lot of upward pressure on stocks overall. The German index of course is a major one that traders will pay close attention to as it is considered to be the“blue-chip” stock indices for the European Union. With that being the case, every time we pull back is likely that we will continue to see plenty of value hunters coming back into the market.
Central Banks
Keep in mind that the DAX market will continue to be influenced by the European Central Bank, and the idea that they may have to loosen monetary policy going forward. Furthermore, you need to keep in mind that the market is also to simply following the other indices around the world, so I think it does have a significant amount of buying pressure underneath. With that being said, I don't have any interest in trying to short this market, because it has been so bullish for so long. As you can see on the chart, I have put up a Fibonacci from the vicious candlestick a couple of days ago, but it doesn't even look like we are getting ready to pull back to the 23.6% Fibonacci root level , let alone anything more significant.
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In general, I think it's more likely than not we will find plenty of buyers and we will eventually break to a fresh, new high. In that environment, I think it's likely that traders will eventually aim for the €19,000 level, but it is going to be a psychologically important level to pay close attention to. With that being said, I like the idea of finding value as it occurs, and despite the fact that we have gotten our cages rattled recently, the reality is that the worst case scenario now looks to be consolidation more than anything else.
Keep in mind that Germany is in a recession, so traders are trying to do what they can to play the idea of cheap monetary policy that will lift assets such as stocks.
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