DAX Advances to Solid Resistance
21 April 2022
Sentiment has been bullish so far on Thursday, pushing EU equities strongly higher. At the time of writing, German DAX traded more than 1.5% stronger, rising to 2-week highs.
The key short-term resistance for the DAX index could be at 14,550 EUR, which is currently being tested. If bulls successfully push the price above that level, the medium-term outlook could change to neutral.
The next resistance will likely be found at March highs in the 14,800 EUR area. However, the index needs to decisively break above the selling zone in the 14,800 - 15,000 EUR range to change the outlook to bullish.
Later in the session, investors wait for FOMC Chairman Jerome Powell and European Central Bank (ECB) Christine Lagarde to speak at the IMF Spring Meetings. Volatility will likely be elevated after their speeches.
Additionally, the European consumer confidence index for April will be released, expected to decline further from -18.7 to -20.0
If sentiment deteriorates, the short-term support could be found at the 50-day moving average (the purple line), currently near 14,350 EUR. However, it looks like the end of the month could be bullish for EU equities as traders seem to be ignoring any bearish factors, such as soaring inflation or recession fears.