Dusseldorf The Dax has successfully tested the mark of around 16,000 points for the second time in a row. After a daily low of 16,090 points last Friday, the leading index slipped to 16,088 points on Monday. In both cases, however, a high level of buying interest ensured that the Dax then rose again. The stock market barometer is currently quoted almost unchanged at 16,170 points.
Last Friday it went down after a series of six record highs in a row. The leading index ended trading 0.4 percent in the red at 16,160 points. It was a mixture of a short expiry date and worries about high corona numbers that made the Frankfurt stock market barometer slide into the red.
In this trading year, such setbacks as last Friday were almost always an entry signal. Does the scenario repeat itself?
Investor sentiment answers this question with a “yes”. A week ago, after evaluating the Handelsblatt survey Dax Sentiment, sentiment expert Stephan Heibel identified the first signs of fatigue, but identified setbacks as an opportunity to buy. He sticks to this opinion after evaluating the current survey.
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Joachim Goldberg came to a similar assessment after analyzing the Frankfurt Stock Exchange survey. The situation for the Dax remains favorable, the mark around 16,000 points serves as support.
Technical analysis also paints a similar picture. As long as the leading German index is listed above 16,000 points, there is no doubt about the upward trend. So far, the decline on Friday to 16,092 places is to be seen as a so-called pullback, i.e. a renewed test of the breakout level.
Martin Utschneider, technical analyst at the private bank Donner & Reuschel, agrees: “In principle, the year-end rally is still intact – including short-term setbacks and slumps.” However, he advises security-conscious and risk-averse investors to adjust the hedges and stops or implement them.
Regardless of the increasing corona incidences, the impact of which on the entire stock market is likely to be rather minor, from a fundamental point of view there are clear signs of relaxation. The situation on the global logistics markets is developing positively.
The Baltic Dry shipping index, which shows the development of the prices for freight rates of container ships, fell further in the past week. And freight costs for containers have also decreased by 13 percent in the past two weeks.
This development explains why logistics papers have given way significantly in the past week. The papers of the Lufthansa airline and the airport operator Fraport each gave way, those of the engine manufacturer MTU Aero even nine percent. When freight rates drop and more containers are available at lower prices, you don’t necessarily have to order by plane.
Look at the individual values
Vonovia: Germany’s largest apartment rental company wants to collect around eight billion euros as part of a capital increase and thus finance part of the purchase price for the takeover of rival Deutsche Wohnen. Vonovia plans to issue a good 201 million new shares in order to partially repay a loan to acquire the company.
20 existing shares entitle the holder to purchase seven new shares at EUR 40 each via indirect subscription rights. The subscription period for the papers is expected to begin on November 24th and end on December 7th, according to the company. This news brings the share a minus of 1.8 percent to 54.70 euros.
Telekom shares: The takeover fantasy in the telecommunications sector, sparked by the offer from financial investor KKR for Telecom Italia, spurred the European industry index, which rose 2.7. Deutsche Telekom’s paper also rose by 1.3 percent. The Telefonica share climbs by more than five percent to the top.
Marks & Spencer: Speculation about a takeover spurred the course. The shares of the British department store chain in London rise 3.5 percent to a two and a half year high of 250 pence. According to media reports, the financial investor Apollo has its eye on the company. Neither company wanted to comment on this issue first.
What the Dax chart technology says
On the downside, investors should pay attention to the still open upward price gaps, which, depending on the risk appetite, can also serve as stop-loss levels. They are a sign of strength as investors are willing to buy at a suddenly higher level in order not to miss a rally.
These gaps (technical jargon: “gap”) arise when the lowest point of the trading day is above the highest point of the previous day. If the gaps remain open, the uptrend will remain intact.
According to technical analysis, the gap from November 4th is considered important, which would be closed at a Dax level of 15,973 points. In this case, there is a risk that the Dax will fall back into the multi-month sideways range between 16,000 points on the top and 14,800 points on the bottom.
On the upside, the previous record high of 16,290 meters will probably only be a transit station. For several technical analysts, the area just under 16,500 positions is the next point of contact.
From the month-long sideways phase between 16,000 and 14,800 meters, a further target price of 17,200 points can be derived in the longer term. According to chart technology, this trading range, i.e. 1200 meters, is a measure of possible price gains.
Here you go to the page with the Dax course, here you can find the current tops & flops in the Dax.