Investors’ risk appetite has been boosted after the UK parliament rejected a no-deal Brexit and voted for a Brexit delay on Thursday evening. Funds flow from safe havens such as Japanese Yen and US Treasuries to riskier assets such as stocks, resulting in European stock markets marching higher.
The German benchmark index DAX has remained bullish since the end of Dec 2018, trading above the uptrend line support. This month the DAX index has traded within a range bound between 11400 and 11630.
Today during Europe midday trading, the DAX index surged and broke out the near-term major resistance level at 11630 with strong bullish momentum. It further tested the next resistance level at 11700, marking a five-month high of 11720.50. Yet the bulls retreated temporarily as the selling pressure at 11700 is heavier, now trading below it.
The 4-hourly Stochastic Oscillator is around 80 indicating a retracement. The bulls might take a break before the next attempt.
Now the next market focus for risk seekers should be the development of the ongoing US-China trade talks.
By Devata Tseng
This article is written by a GO Markets Analyst and is based on their independent analysis. They remain fully responsible for the views expressed as well as any remaining error or omissions. Trading Forex and Derivatives carries a high level of risk.
Sources: Go Markets, MetaTrader4, Tradingview