Dusseldorf After the new high for the year with subsequent profit-taking, the German stock market is on the up moderately. The leading index Dax was up 0.3 percent in the morning and was trading at 15,754 points.
Yesterday’s trading day showed a trend: new highs for the year are no longer signals for follow-up purchases, which is usual, but an invitation to take profits. This was not only the case yesterday, Wednesday, but also on April 4th, when the Dax suddenly fell 250 points the following day after rising to the high for the year at the time of 15,737 points.
There is a high probability that this scenario will repeat itself and that the leading German index will continue to fall in the short term. Because with the profit-taking on Wednesday after the new high for the year, which is 15,827 points, the technical starting position has deteriorated.
Losses are likely to be moderate
If the technical analysts are right, it is more likely to be a brief interlude before things start moving up again. Because despite the profit-taking on Wednesday, there was another positive signal: With 15,703 points at the end of trading, the Dax also made a new high for the year at the end of the day.
According to Martin Utschneider from the private bank Donner & Reuschel, “profit-taking should be moderate”. And for Jörg Scherer from HSBC Germany, after “a possible consolidation, the 16,000 mark is on the bulls’ agenda before they can set their sights on the all-time high”. The record mark is 16,290 points.
And Scherer is certain: “The resistance at 16,285/16,290 points, the highest levels of 2022 and 2021, is robust!”
When looking at the possible supports, the area between 15,300 and 15,400 is particularly striking. There, with 15,353 points, is the 38-day line, which shows the short-term trend. A slide below 15,300 points could trigger a test of the 15,000 zone, below which is the low of the past two weeks at 14,809 points.
It is quite possible that the Dax will not fall that low. There is already a first support area at around 15,600 to 15,650 points.
Professional investors have lost patience
The current survey by the Frankfurt Stock Exchange among medium-term oriented investors also shows that the way up is likely to be difficult, at least in the coming trading days. Profit-taking is likely to occur at the latest at prices just above 16,000 points.
The reason: Many investment professionals have lost patience in the past few days. Just a week ago, the majority of the institutional investors surveyed were pessimistic, now they are optimistic again. The bear camp has significantly reduced, with 75 percent of the ex-pessimists moving directly into the bull camp. They are back on rising prices.
According to sentiment analysis, optimism among investors tends to be considered a burden on further price development because, to put it simply, there are fewer buyers.
Behavioral economist Joachim Goldberg, who evaluates the survey, expects in view of the many negative headlines such as growth concerns or increased tensions between China and Taiwan that the new bulls among the professionals would be satisfied with small profits. Courses around the 16,000 mark should be the sell signal for them.
On the downside, the previous support level of 15,330 to 15,380 points, where the former pessimists wanted to buy again, has weakened due to the new buyers. But in Goldberg’s opinion, the swing in sentiment, while a mild drag, is not a critical one. In the longer term, basic pessimism still prevails.
Look at the individual values
BASF: The Ludwigshafen-based chemical giant posted a sharp decline in its operating profit (EBIT) in the first quarter. The slump in operating earnings was less severe than feared by most analysts. The figures were released on Wednesday afternoon. After an increase of 0.8 percent on the previous day, the share continued to rise on Thursday and is listed up one percent.
Economy: The electronics retail chains Media Markt and Saturn increased sales in the past quarter. The parent company Ceconomy reported on Wednesday that the chains had “recorded good customer demand” from January to the end of March. The stock rose 0.7 percent.
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