Baxia Markets
November 09, 2023

DAX Navigates Mixed Signals: German Inflation Eases While ECB Chief Warns of Inflationary Risks

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German inflation and Eurozone retail sales figures released on Wednesday tempered concerns that the ECB would maintain higher interest rates for an extended period. Germany's annual inflation rate moderated from 4.5% to 3.8%. Notably, Eurozone retail sales slipped by 0.3%, suggesting a softening demand environment.


The uncertain macroeconomic outlook further raised the possibility of the ECB adopting a less hawkish stance on interest rates. Although the data proved positive for the DAX, ECB Chief Economist Philip Lane remained wary of inflation. Lane downplayed the recent decline in Eurozone inflation, attributing it primarily to a steep drop in energy prices. He projected that inflation is unlikely to revert to the ECB's target of 2% until 2025.

DAX Navigates Mixed Signals: German Inflation Eases While ECB Chief Warns of Inflationary Risks

DE30 Price Action

DE30 is currently on the move following a bullish rally that lasted for a week. The EMA 50 and EMA 200 are narrowing, indicating that the bulls are gaining momentum. A golden cross, a bullish signal, is expected when these two indicators intersect.

The price has broken above the EMA 200 (magenta) and is testing its strength. To confirm this breakout, the price needs to close above the recent swing high (red rectangle) at 15247.


The RSI supports the bullish scenario as it is above the 50 level. A bearish RSI occurs when it falls below the 40 level.

The MACD histogram and signal line are both above the 0 line, indicating a bullish trend. The histogram is also above the signal line, further reinforcing the bullish trend.


Key Levels to Watch:

Potential Scenarios:

  • If the price breaks below 15068, the RSI falls below 40, and the MACD histogram crosses below 0, panic selling could occur.
  • If the price breaks above 15247, the MACD is above 0, and the RSI is above 40, the price could continue its upward momentum to 15370-15468.

Key Economic Releases to Watch Today

USD, Initial Jobless Claims

Forecast 215K vs Previous 217K


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