European stocks vulnerable – EURO STOXX 50 and DAX forecast

Intermediate
  • The global financial markets “risk on” theme has been damaged since last Thursday’s selloffs across global stock indices.
  • Despite Friday rebounds, Monday has seen a renewal of negative forces attempting to resume the larger bear theme from September.
  • Risk off” is being driven by:
    • Fading hopes of a US economic relief package before the US elections
    • Surging COVOD-19 cases across Europe
    • More aggressive lockdown measures throughout Europe
    • Risks of no trade deal between the UK and EU
  • Here we look at the German and pan-European benchmark averages, the DAX and the EURO STOXX 50.

DAX day trade outlook: Negative bias resumes

Day trade update and view

A Friday-Monday rebound above 12850/860 and 12949/951 resistances, to then stall below 13052.5 at 13018 and then to significantly sell-off below 12800/780 supports to resume negative forces from last Thursday’s plunge through multiple supports, to keep the threat to the downside Tuesday.

Day trade setup

  • We see a downside bias for 12708.5/691; a break here aims for 12581.5 and 12521 lows, possibly towards 12400/390.
  • But above 12886 opens risk up to 13018 and 13052.5, possibly 13163.

DAX intermediate-term outlook

The late September sell-off below 12625.5 signalled an intermediate-term shift to a broader range seen as 12199.5 to 13244.5/279.

  • Downside risks: Below 12199.5 sets an intermediate-term bear trend to target 11589.5, 10856.5 and 10159/10000.
  • Upside risks: Above 13244.5/279 sets an intermediate-term bull trend to target 13461, 13824 and maybe 15000.

8 Hour DAX Chart

dax chart

EURO STOXX 50 day trade outlook: Negative theme after rebound failure

Day trade update and view

A Friday-Monday rebound attempt above Thursday resistances seen as high as 3271, but stalling and falling from 3276 on Monday through 3220/14 supports, to resume negative pressures from last Thursday’s plunge through multiple supports to 3166, to keep the risk lower for Tuesday.

Day trade setup

  • We see a downside bias for 3197/91; a break here aims for 3166 and 3136.
  • But above 3230 aims for 3256 and opens risk up to 3276 (and possibly even 3301).

EURO STOXX 50 intermediate-term outlook

The push below 3139 signalled an intermediate-term shift to a bear trend.

  • Downside risks: We see an intermediate-term bear trend to aim for 3046, 2844 and 2690.
  • What changes this? Above 3349 shifts the intermediate-term bear trend to neutral; through 3395 to an intermediate-term bull trend.
8 Hour EURO STOXX 50 Chart
8 Hour EURO STOXX 50 Chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

Comment on this video

Your email address will not be published. Required fields are marked *


Latest Related News

Bullish European stocks indices – DAX and EURO STOXX 50 forecast

A strong tone, with a dip and a rebound on Monday to end November for European (and global) equity averages.This “risk on” theme remains from vaccine hopes and the Biden bounce.Tuesday has already seen very strong Chinese Manufacturing Purchasing Managers Index (PMI) data, with further global data due today.European averages have managed to hit to new cycle highs.Here we review the German and pan-European benchmark… Continued

European stocks averages hit new cycle highs – DAX and EURO STOXX 50 forecast

A strong rally for European (and global) equity indices to start the week with more positive news from Astra Zeneca/ Oxford University on their COVID-19 vaccine trials.This “risk on” theme was also helped by Janet Yellen’s appointment as Treasury Secretary by US President-elect Joe Biden.Plus, the positive outlook for stock averages has been helped by the start of the US Presidential transition of power.European averages… Continued

European share indices stay strong (DAX and EURO STOXX 50 forecast)

A solid rally for European (and global) chare markets to begin the week with news from Moderna that their COVID-19 vaccine trials had been extremely successful with a 95% success rateThis on the back of similar results last week from Pfizer for their vaccineEuropean stock indices were higher Monday with this news, though not as aggressively up as last weekSurging COVID-19 cases and hospitalisations in… Continued

Bull surge for European stocks – DAX and EURO STOXX 50 forecast

A strong advance to start Monday with the declaration at the weekend of Joe Biden as President-elect.This saw global equity markets start the week on a very positive footing, with European averages gapping higher.Then, the breaking news from Pfizer that their COVID-19 vaccine trials had been extremely successful with a 90% success rate produced an extremely aggressive rally across global stock markets Monday.With key technical… Continued

European stocks bounce, but stay vulnerable (DAX and EURO STOXX 50 forecast)

A rebound to start the week by European and global stock indices, maybe some position squaring ahead of the US election.In addition, with Biden holding his strong lead in the polls over the weekend, markets are looking for a smooth transition of power, now comfortable with a Democrat victory and even a blue sweep.However, the underlying aggressive “risk off” theme from latter October remains intact,… Continued

Forex Brokers in your location


SIGN UP

72% of retail investor accounts lose money when trading CFDs with this provider.


SIGN UP

74-89% of retail investor accounts lose money when trading CFDs with this provider.


SIGN UP

75% of retail investor accounts lose money when trading CFDs with this provider.


SIGN UP

76.4% of retail investor accounts lose money when trading CFDs with this provider.