Date: 01 Jul 2019

Deutsche Bank’s share price has recently surprised many investors and not in a positive way. Over the past few weeks, the share price has tested more and more lows.

For the head of Deutsche Bank, Christian Sewing, his grace period has probably expired after more than a year in office, and the rumour mill was boiling over the weekend. First, there was the report from the F.A.S. media outlet that Sewing was stopped at a Chinese airport for lack of a visa and therefore had to shorten his visit to the Middle Kingdom. Then on Friday, news that the bank plans to cut the 20.000 jobs. Finally, the announcement reported in F.A.Z. on Sunday evening that the bank plans an even more substantial reorganization of the executive committee. According to the report, however, Sewing does not expect the situation to be tricky. On the contrary, he expects to receive even more competences. In addition to his board responsibility, he should also take care of investment banking, F.A.Z. said.

The company has been making losses in investment banking in several quarters, although for many investors it is still unclear where exactly these losses arise. Transferring tasks in this area to Sewing would have the advantage of reducing the size of the board. At the same time, the massive job cuts already announced, and the associated reduction in investment banking could thus become the top priority of the Management Board. This could be a ray of hope for the bagged share.

From the low at the end of May, at the beginning of June, the share was able to loosen somewhat and rise to the low of the end of December 2018. Thus, the zone around €6.80 could be decisive for a further price rise. If the sustained jump above this level is successful, the next significant structural level in the region at €8.37 could wait. Other critical structural barriers on the way up could then be in the €10.20 and €11.85 areas.

However, if the market drops again, the June lows in the €6.00 zone could support the market. If the market breaks through with downward momentum, the sentiment could turn in completely. Then the market would reach uncharted territory again, and a technical assessment of the support zones would be challenging. Should there be a more significant decline, the €3.50 zone could support the market.

The MACD oscillator showed a bullish cross around June 13th. A breach of the MACD line through its zero lines would confirm this signal.

 

DBK GE Daily Chart Source ActivTrader

DBK.GE Daily Chart | Source: ActivTrader

 

Written by Daniel Schuetz, External Analyst, ActivTrades

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