It's widely known that private investors, in particular, struggle to continue buying when markets are supposedly "too high." The million-dollar question is what can be considered too high, and what if there's no reason for a market like the DAX to reverse direction?
The current critical situation with US tariffs is undeniable. However, it also seems obvious to the markets that the US is interested in bringing the self-imposed negotiation situation to a positive conclusion. This has always been the case, so why should it be different with the European Union?
Furthermore, this trading week will see the release of inflation data from the European Union. A further cooling of inflation rates is also expected. Core inflation is anticipated to be at 2.4 percent, which would represent a 0.3 percent decrease. Consequently, the market can assume another key interest rate cut from 2.4 percent to 2.15 percent.
US Labor Market in Focus - Will There Be an Impetus for a Correction?
Looking at the US labor market, it's also clear that it remains stable without overheating. This means that the report on newly created jobs could potentially tip the scales and unsettle the stock markets. If the Federal Reserve interprets the labor market as too hot and increased inflation becomes apparent, there's a possibility of a more conservative monetary policy approach. This, in turn, could be the impetus for a cooling of the stock markets.
23,800 Points Serve as Support in the DAX
The German stock market thus faces an interesting trading week. On Friday, the short-term downward trend was stopped again, though without convincingly indicating an immediate rebound. Thursday's low of around 23,800 points represents the support level that will likely determine whether the upward trend can be continued in the short term.
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