DAX 30 Forecast:
DAX 30 Price Outlook: Index Probes Trendline Support Ahead of Next Week
The DAX 30 posted a strong gain for the month of April, returning just under 13% despite much of the developed world remaining under quarantine. As economic data deteriorates and joblessness rises, the DAX and other major equity players pressed higher. To be sure, there are causes for optimism as the number of coronavirus cases eases and central banks reaffirm their commitment to buoying their respective economies.
Still, I find it difficult to justify some of the rebounds witnessed and with a negative start to May, many analysts have questioned whether the decline will be more broad or if recent losses are just a speedbump as equities continue to melt higher. Also, the arrival of May brings with it the “Sell in May and Go Away” phenomenon,[1] a seasonal effect which has coincided with poor stock returns in the month.
DAX 30 Price Chart: 4 – Hour Time Frame
That being said, the month of May does not always lead to stock losses and forecasting the trend of an entire month off just the first trading session is presumptuous to say the least. However, the technical levels at hand may be relevant regardless of gains or losses and could play a vital role in the larger direction of the index.
Thus, holding above the ascending trendline drawn from the April lows will be an early indication of how price action may unfold. Should it fail, further losses may become more likely and the German equity index could fall to Fibonacci support around 10,209.
On the other hand, a successful bounce off the level could allow bulls to regain their footing and provide a foundation for a run at
