After failing at 12,500 resistance, the GER30 came under intense selling pressure today, bringing the index to a fresh one-month low. DAX bulls will need the psychological support level at 12,000 points to hold, as a clear break below could signal a potential reversal. The next key level to watch would then be 11,850 points - which is close to the 76.8 % Fibo of the May-June rally.
What is weighing on the DAX?
- Disappointing economic data out of the Eurozone
- A rather poor corporate earnings season in Germany
- Concerns about a no-deal Brexit
Gold has lost some of its momentum recently, and the negative RSI divergence on the Daily chart is not a good sign either. Nevertheless, the precious metal managed to remain bid and price bounced off the 21 DMA multiple times in the past two weeks. Bulls are still in control, and it would take a clear break below $1400 support to change that. To the topside, the key level to watch is $1452.
What is keeping Gold supported?
- A decrease in US rate expectations
- Geopolitical tensions
- Uncertainty about the outcome of the on-going trade talks between the US and China
USOIL is advancing, but the resistance area between $58.20 and $58.40 is one to keep a close eye on. It has acted a key support/resistance multiple times in the past, and the commodity struggled to clear this hurdle today. Overall, the charts suggest that the short-term outlook remains positive, as USOIL managed to break above the 21 DMA and 200 DMA. Should it leave the $58.40 resistance level behind it as well, bulls will be aiming at a retest of the July high (around $60.80).
What is keeping USOIL bid?
- Political tensions in the Middle East
In January the Fed needed to put the Taper Genie back in the bottle; now they need to convince the short end crew to back off repricing the Fed Funds strip