Market Forecast 31/08/2017

DAX 30 Index Forecast – Facing Crucial Hurdle

Key Points

  • The DAX 30 index remained in the bearish zone and recently tested the 11,860 support zone.
  • There is a major bearish trend line positioned near 12,170 on the 4-hours chart of DAX 30 Index.
  • Today in the Euro Zone, the Consumer Price Index for August 2017 (Preliminary) was released by Eurostat.
  • The forecast was slated for a rise of 1.4%, but the actual was better as there was a rise of 1.5% (YoY).

DAX30H4

The DAX 30 index is in a declining path since 12,900 and it recently traded below the 12,000 level. It remains in a bearish zone with many resistances on the upside like 12,200.

The price tested the 11,860-70 levels where it found support and started a minor recovery. It has moved above the 38.2% Fib retracement level of the last decline from the 12,269 high to 11,865 low.

However, there is a major bearish trend line positioned near 12,170 on the 4-hours chart. The same trend line resistance near 12,170 is sitting with the 100 hourly simple moving average.

Therefore, it won’t be easy for the index to break the 12,170 resistance area and trade above the 12,200 level. At the moment, it is struggling to close above the 50% Fib retracement level of the last decline from the 12,269 high to 11,865 low.

Selling rallies close to the 12,170-12,200 resistance area can be considered in the short term.

Euro Zone CPI

Today in the Euro Zone, the Consumer Price Index for August 2017 (Preliminary) was released by Eurostat. The forecast was slated for an increase of 1.4% in the CPI compared with the same month a year ago.

However, the actual result was above the forecast as the CPI increased by 1.5%. Looking at the Core CPI, the forecast was slated for an increase of 1.2% (YoY), but the actual was better as the Core CPI rose 1.3%.

According to the report, energy prices are lined up to rise at the highest annual rate of 4% in August 2017, followed by a 1.6% rise in services and food, alcohol & tobacco are expected to increase at an annual rate of 1.4%.

SPX 500 Index Forecast – Crucial Resistance Break?

Key Points

  • The SPX 500 Index after forming a bottom near 2,423 started an upside move and traded above 2,450.
  • There was a break above a bearish trend line with resistance at 2,445 on the 4-hours chart of the SPX 500 Index.
  • Today, the US Personal Income figure for July 2017 will be released by the Bureau of Economic Analysis, Department of Commerce, which is forecasted to increase by 0.3% (MoM).

SPX500H4

The SPX 500 Index started a downside move after trading near the 2,500 level. It declined sharply and traded towards the 2,400 level.

It traded as low as 2,419 and later started consolidating in a range. It formed a base and pumped higher above the 2,450 level and the 100 hourly simple moving average.

It also broke a bearish trend line with resistance at 2,445 on the 4-hours chart. These are positive signs and suggest more gains towards 2,470 in the near term.

 

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