Date: 06 May 2019
“Sell in May and go away” … that’s how the old investment saying goes, but will it be so this week?
The Nasdaq closed last week with a new record high after April’s labor market data. The positive US figures also stimulated markets in other regions.
The German benchmark index, the DAX, continued its upward trend on Friday. Although it did not mark any new highs, it continued its slow, but steady, upward movement.
The question now is whether the air has become thinner for the index. After all, the DAX has gained almost 17 percent since the beginning of the year. This could encourage the first investors to realize profits. Looking back, the month of May has often been a challenge for investors.
From a chart technical point of view, the trend is still intact. The German benchmark index is well above its upward trend line and has climbed above the 12,400 mark.
As in the USA, in Germany, companies are opening their books and giving investors a glimpse inside. This should be decisive for further development in the coming days. Can the large DAX companies such as BMW, Siemens, and Munich re-inspire investors and drive the DAX higher?
The DAX tested the September 2018 highs with last week’s closing candle and has found first resistance there. If the positive trend continues this week, the next resistance zone be at 12,550 points. Further resistance could then occur in the areas at 12,800, 12,950 and finally at 13,150.
However, if the old highs turn out to be too strong, the first support might be waiting at 11,275. Further support could then be found in the 12,000, 11,800, 11,520 and 11,275 zones.
Ger30 Daily Chart | Source: ActivTrader
Written by Daniel Schuetz, External Analyst, ActivTrades
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