The German economy made a good start to the second quarter and should continue to expand at a moderate pace, the Economy Ministry said in its June monthly report. However, alongside opportunities there are some risk factors such as the oil price or developments around Greece, which could return to the center stage.
Renewed uncertainty put European markets on the red and sent Greece’s top share index down on Friday. However European leaders have expressed urgency that a deal should be made before Greece’s current bailout package expires at the end of June. Talks between Greece and its creditors must intensify in the coming days.
The Index fell 2.56% since the start of the month and rose 15.08% year to date and is in a warning phase. DAX30 initially fell last week but found enough buying pressure to close at the open of the week. The Index breached to the down side the upward trend line although the stochastic is showing an oversold market.
Expecting an upward move to weekly resistance at 12,096 on a break above previous week high at 11,453 (scenario 1) or a break below previous week low at 10,865 could push the Index to the 50-week moving average at 10,355 (scenario 2).
Ger30 is a CFD written over DAX30 futures.