DAX Misfires at the Open: US Holiday Sidelines the Bulls
It was a rather sluggish start to the new trading week. While the US celebrated "Presidents' Day" and Wall Street remained closed, the Frankfurt floor was quite literally running out of steam. Without the usual impulses from overseas, investors were unable to develop any "imagination" that could have lifted the DAX above the psychologically important 25,000 mark. By the end of the day, the leading index recorded a loss of 0.46%, bidding farewell to the session at 24,800.91 points.
One could interpret yesterday's trading as a typical "holiday vacuum": without the fresh wind of US investors in the afternoon, the index drifted listlessly. However, for optimists, there is a statistical glimmer of hope: historically, US investors often return to their desks with a healthy dose of euphoria after holidays. For today, Tuesday, this could mean that we will see a significant pick-up in activity and potentially rising prices, particularly in the afternoon.
Morning Sentiment Check: Will the ZEW Index Save the Day?
Before the Americans join the fray, all eyes shift to domestic data at 11:00 AM CET. The release of the ZEW Indicator of Economic Sentiment is considered a major gauge for the mood within the German economy. The bar is set high: analysts are expecting a significant brightening to 63.5 points, up from 59.6 points in January.
If the ZEW index meets or even exceeds expectations, it would be a strong signal that the trough of economic development in 2026 has finally been passed. Such an upswing in sentiment could be the necessary catalyst to release the DAX from its current lethargy.
Technical Analysis: Glimmers of Hope Despite Red Signs
Although the closing loss initially seems disappointing, a look at the chart reveals an interesting constellation. Despite the weaker closing price, the market managed to form both a higher daily high and a higher daily low on Monday compared to Friday. In technical analysis, this structure is often a harbinger of a short-term price reversal.
Bottom line: The DAX is still battered, but it is showing the first signs of resilience. If today’s positive US sentiment meets a strong ZEW index, the upward breakout could come faster than many skeptics currently anticipate.
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk. Forecasts are not guarantees. Rates may change. Political risk is unpredictable. Central bank actions may vary. Platforms’ tools do not guarantee success.