V-Shaped Miracle in the DAX: Trump's Comments End the Freefall
The start of the week initially resembled a true horror scenario for traders and investors. The German leading index kicked off Monday's trading with a terrifying downward gap and, in an initial wave of panic, temporarily plunged below the psychologically crucial 21,000-point mark. But just as capitulation seemed inevitable, a single message from the White House sparked a brutal turnaround. U.S. President Donald Trump surprisingly announced "good negotiations" with Iran. This political impulse sent the DAX rocketing upward in a V-shaped recovery. All intraday losses were swiftly shaved off, and the index ended its wild ride with a brilliant gain of 1.22%, closing at 22,653.86 points.
The Oil Drama Persists: Will the Supply Gap Force Europe Back to Putin?
Despite this spectacular rescue mission, the unpredictable days on the stock markets are continuing seamlessly. The erratic communication policy of the U.S. remains a guarantee for volatile price jumps. However, what market participants have likely not yet fully priced in is the fundamental drama in the oil market—the main artery of the global economy. It is no longer just the blockaded Strait of Hormuz, which Iran continues to control as leverage. Far more severe is the gigantic supply gap that has already emerged. Even if the strait reopens tomorrow, a massive production surplus would be required to offset the global deficit. Out of sheer economic necessity, this could soon force European nations to grudgingly re-approach Russia to avert a looming energy collapse.
Technical Summary: Defensive Optimism After the Cliff Dive
Even though this supply problem will somehow be resolved in the medium term, the DAX is not immune to taking further hits in the short run. From a technical perspective, however, this positive daily close on Monday was of inestimable value. The rebound after diving below 21,000 points reveals the first cautious signs of easing. The bulls have proven that political impulses can trigger massive counter-movements. For courageous investors, a phase of "defensive optimism" is now emerging. Early market entries can be lucrative right now, as long as the omnipresent geopolitical risks are flanked by strict risk management.
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