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Predrag V

DAX Index


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Hi Predrag, thanks for your question. 

DAX Index has been one of the best performers recently. The German benchmark index has recorded a series of consecutive days of gains as it closes in on the key short-term support near 12000.

Fundamentally, the DAX Index has been boosted by the decision of national authorities to allow travel to 31 European countries (EU member states + the UK, Iceland, Norway, Switzerland and Liechtenstein), starting from 15 June.

This decision comes as a result of increased pressure on Angela Merkel to lift some restrictions. In a meeting between the federal government and regional authorities, the agreement has been reached to extend social distancing measures until the end of June. Moreover, the limit of the maximum number of people that can meet has been increased from two to ten. 

Separately, the German government is bailing out Lufthansa, a national carrier. The deal will give a 20% stake in the carrier to the government in exchange for €9 billion. The government intends to sell the stake at the end of 2023, it is announced.

“The support that we’re preparing here is for a limited period. When the company is fit again, the state will sell its stake and hopefully … with a small profit that puts us into a position to finance the many, many requirements which we have to meet now, not only at this company,” said Germany’s Finance Minister Olaf Scholz.

Going back to the technicals, the DAX Index reached the early March levels for the first time today. It means that more than half of corona-triggered losses are now recovered for the index as the buyers prepare for an assault on the key resistance near the 12000 mark. This is a zone that hosts a series of key moving averages on both the daily and weekly charts.


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