This day we face inflation data in several euro zone countries, including Germany. In the American session, ECB member Isabel Schnabel will issue a statement. The German representative argues that rates should be maintained as they are at least until June, but it remains to be seen whether the presidency will heed the recommendations of the Executive Board. As early as February, she suggested that the long period of high inflation would force us to adopt a "stop-and-go" policy similar to that of the 1970s, promoting caution and not adjusting the ECB's policy stance prematurely. We will see if the German will change her mind once the German market regains its tone in the direction of economic growth.

If we focus on the chart, currently the DAX position (Ticker AT: GER40), is bearish, partly due to the poor industrial production data and the performance of the German market in general. As well as Germany's difficulty in selling to its key market which is the United States, as its exports have declined. On May 10 there was a bearish correction figure and signal, also signaled by the RSI, and it is true that it has been continuing during this week in a gradual way, possibly in anticipation of the ECB statements.

At this moment, it would be foreseeable for the index to return to its last bullish support in the 18277.38 zone if the market loses its positive tone. If the German market x-ray for the summer is more positive, there could be a rebound in the 18603 points zone and try to find again the highs at 18844 points. Currently the RSI is slightly oversold, and the price bell indicates a downward continuation as the bell has a very marked figure with a checkpoint well below the bullish support zone at 17950 points.

Ion Jauregui - AT Analyst




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