DAX Resilience To Shine ThroughThe DAX Index continues to hold strength just beneath all-time highs, popping higher above 24,000 after three consecutive sessions of gains.
Bulls are keeping control through strong earnings in tech and auto sectors, combined with supportive macro tailwinds. However, the major resistance and previous ATH remain to be tested.
U.S. Interest Rate Path in Focus
The Federal Reserve held rates steady at its July meeting but left the door open for a possible cut in September, should inflation and labor market data soften.
Markets are pricing in an increasing probability of a cut, which is fueling optimism across global equities.
A dovish Fed supports global risk sentiment and weakens the USD, indirectly benefiting European exporters.
ECB Holds, But Dovish Undertone Grows
The European Central Bank left rates unchanged in its latest decision, but ECB President Christine Lagarde acknowledged that “disinflation is progressing” and that further tightening is unlikely.
Forward guidance was interpreted as dovish, with the market now expecting a cut by December, possibly sooner if economic activity remains sluggish.
A dovish ECB lowers borrowing costs and improves equity risk premiums, especially for cyclical-heavy indices like the DAX.
EU–U.S. Trade Tensions
Recent rhetoric from U.S. officials, including renewed tariff threats on European pharmaceutical and automotive exports, has reignited trade tensions.
The EU has signaled its willingness to respond proportionally, but negotiations are ongoing.
While no measures have been enacted yet, uncertainty over trade policy is capping some upside momentum in European equities.
German automakers and industrial exporters are vulnerable to tariffs. Continued trade uncertainty may limit gains unless diplomacy resolves key friction points.
The DAX remains resilient, buoyed by improving fundamentals, strong earnings, and global rate expectations.
The index is coiled just under a key psychological resistance at 24,000, with bulls eyeing a breakout toward the all-time high near 24,639.
Momentum remains favorable, but traders should watch macro headlines and volume closely around resistance zones.
