DAX Index Today: Eurozone Data, the ECB, and a Move Toward 15,000

Overview of the DAX Performance on Tuesday

The DAX rallied 0.67% on Tuesday. Following a 0.30% gain on Monday, the DAX ended the Tuesday session at 18,384. Notably, it reached an all-time high of 18,412, extending its winning streak to six sessions.

German Consumer Sentiment Improves

On Tuesday, the German GfK Consumer Climate Indicator signaled a modest improvement in consumer sentiment. The GfK Consumer Climate Indicator rose from -28.9 to -27.4 for April.

While consumer sentiment improved modestly, sub-components, including ‘willingness to buy,’ supported bets on a June ECB rate cut. Nonetheless, the ‘willingness to save’ sub-component fell by five points, contributing to the uptick in the headline number.

ECB policymaker Yannis Stournaras highlighted increasing support within the ECB for a June rate cut. The comments also drove demand for DAX-listed stocks.

US Consumer Confidence Unexpectedly Dips in March

US consumer confidence numbers for March supported a DAX rise to 18,412. An unexpected fall in consumer confidence raised hopes of an H1 2024 Fed rate cut.

However, uncertainty lingered regarding Fed interest rate cut plans. Recent Fed speakers have sent mixed signals, testing expectations of a June Fed rate cut.

On Tuesday, the Nasdaq Composite Index ended the session down 0.42%. The Dow and the S&P 500 saw losses of 0.08% and 0.28%, respectively.

The Tuesday Market Movers

Bets on central banks cutting interest rates in H1 2024 fueled buyer demand for tech stocks. Infineon Technologies and SAP advanced by 1.54% and 1.03%, respectively.

Auto stocks also contributed to the Tuesday gains. Volkswagen and Porsche saw gains of 1.57% and 1.01%, respectively. BMW advanced by 0.30%, while Mercedes Benz Group declined by 0.37%.

Online retailer Zalando SE also responded to the German consumer confidence report, rising by 0.84%. Adidas gained 0.17%.

Investors reacted to Goldman Sachs (GS) upgrading BNP Paribas from neutral to buy. Commerzbank and Deutsche Bank ended the session up 0.59% and 0.44%, respectively.

Eurozone Economic Sentiment and the ECB in the Spotlight

On Wednesday, economic sentiment and finalized consumer confidence figures for the Eurozone require investor consideration. Upward trends in sentiment toward the economy and improving consumer confidence could signal more DAX gains.

Economists forecast the Economic Sentiment Index to increase from 95.4 to 96.3 in March. According to preliminary numbers, the Consumer Confidence Index increased from -15.5 to -14.9.

Beyond the numbers, ECB commentary also needs monitoring. Increasing support for a June ECB rate cut amidst a more positive economic outlook could support further DAX gains.

Later in the session, there are no stats from the US for investors to consider. Nonetheless, investors must track FOMC member chatter later in the European session.

Short-term Forecast

Near-term trends for the DAX will hinge on the next round of inflation numbers. Softer consumer price trends would support expectations of a June ECB rate hike and the appetite for riskier assets. Moreover, investors must continue to consider central bank comments.

In the futures, the DAX was down 3 points, while the Nasdaq mini was up by 57 points.

DAX Technical Indicators

Daily Chart

The DAX sat well above the 50-day and 200-day EMAs, sending bullish price trends.

A return of the DAX to the March 26 all-time high of 18,412 would support a break above the 14,500 handle.

Economic data for the Eurozone and central bank commentary warrant investor attention.

A break below the 18,350 handle could bring the 18,250 handle into play.

The 14-day RSI at 85.25 shows the DAX in overbought territory. Selling pressure may intensify at the March 26 high of 18,412.

4-Hourly Chart

The DAX held well above its 50-day and 200-day EMAs, confirming the bullish price trends.

A DAX breakout from the March 26 all-time high of 18,412 would support a move through the 18,500 handle.

Conversely, a drop below the 18,350 handle could signal a fall toward the 50-day EMA.

The 14-period 4-hour RSI at 80.63 shows the DAX in overbought territory. Selling pressure may intensify at the all-time high of 18,412.