DAX 40 edge hit higher by poor economic sentiment

• The sluggish ZEW economic sentiment failed to curb the upward rally.
• Energy degradation affects new sectors, putting further pressure on governments.
• Leaked paper shows EU unlikely to limit Russian gas price – The Guardian

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DAX 40: Moves on unimpressed by bad economic sentiment

dex Continuing its lead in European trade with a gain of 100 points from the session’s low. Market sentiment remains bullish as we approach the end of the day US CPI print. we also had german inflation numbers Eurozone and German ZEW economic sentiment The numbers released had no significant impact on the index.

The German CPI number rose from 7.5% in August to 7.9% annually, the highest level since the 1990 reunification. We saw growth in food and services, while energy prices remain high. Energy products saw a sharp increase with hot oil (111.5%), natural gas (83.3%), electricity (16.6%) and motor fuel (16.5%) respectively. at the same time we saw Euro and German investor confidence A move to new lows should add some uncertainty to the ECB’s rhetoric going forward.

For all market-moving economic releases and events, see DailyFX Calendar

On the energy front, we are seeing the ripple effect as rising energy prices affect sectors beyond utilities and energy-intensive industries. The impact is being felt in the UK, Belgium and Germany as companies grapple with rising costs. The German finance ministry announced yesterday that it would like to boost state loans for energy companies through credit authorizations already created during the pandemic for a relief fund. According to the Handelsblatt business daily, government sources indicated that a credit of EUR67 billion is expected to be transferred from the WSF Economic Stabilization Fund to the state development bank KFW. The impasse would result from a meeting of energy ministers last week regarding the cap on Russian oil, according to leaked documents seen by the Guardian.

Corporate Bayer AG (BAYGn) has apparently started looking for a new CEO, according to people familiar with the matter. Current CEO Werner Baumann has been the subject of shareholder disappointment on several occasions since his appointment in 2016. Shares in Bayer AG were up 2.1% for the session.

DAX 40 Daily Chart ,September 132022

Source: TradingView

From a technical point of view, we had a bullish candle Closed on last Friday 13000 Key Psychological Levels, The weekly candle closed without any upside, indicating strong momentum for buyers and a strong upside potential this week.

On the daily timeframe we have seen a steady increase since yesterday Bullish Marubozu Candle close. broke above us 20,50-SMA and trade with the trendline just above the 100-SMA. Price action shows that we have failed to clear previous lows on the daily and have now printed a higher low with a need for a higher high to confirm a change of structure. As much as technicality can tell us that any further upside moves will depend on US CPI data, a downside miss could soon see the index rally higher as the risk-on mood persists.

Key intraday levels that are worth watching:

support area

•13340

•13275

•13110

resistance zone

•13570

•13771

•13900

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Written by: Zain Vavada, Writer for Market DailyFX.com

Contact and follow Jain on Twitter: @zvawda