DAX Crumbles in Pre-Market Trading
Today's Asian market signals for European trading are incomplete as the Chinese stock markets remain closed due to the Golden Week holidays. Consequently, attention is more focused on the Japanese indices. The Nikkei 225 showed resilience this morning (05:10 CET), gaining 893 points or 2.31%. Traders cited the USD's strength against the JPY as the reason. USD/JPY was temporarily traded at 149.15. This USD strength was initiated by surprisingly strong labor market data released on Friday. However, the renewed JPY weakness is a thorn in the side of Japanese monetary authorities. Therefore, over the weekend and again last night, voices from the BoJ (Bank of Japan) warned that the current development harbors many dangers. In other words: the BoJ will intervene soon. In the early morning hours, USD/JPY dropped slightly to 148.55.
The DAX also struggled in Asian trading to defend its post-market gains from Friday. After the US labor market data, the German leading index rose to 19,230 points. This gain was gradually given up in Asian trading, and in the morning hours, the DAX was traded at about 19,185 points.
DAX Today
Despite the slight decline of the DAX in Asian trading, we expect a steady to well-supported start to the new trading week today. From a technical perspective, profit-taking is likely to continue. Very short-term oriented traders can probably trade both sides today: in the first half of the trading session, continued profit-taking, and in the second half, a reversal to a positive trend. We are initially leaving the short side out and trying to get a good long entry around Friday's closing level. Mid-term, we remain long after the correction of the past few days.
Economic Calendar Today (Filtered):
All day: Holiday in China - National Day
03:30: AUD MI Inflation Gauge (Monthly)
07:00: JPY Leading Index (Aug)
08:00: GBP Halifax House Price Index (HPI) (Monthly) (Sep)
08:00: EUR Industrial Orders (Monthly) (Aug)
09:00: CHF Foreign Exchange Reserves in USD (Sep)
10:00: CNY Foreign Exchange Reserves in USD (Sep)
10:30: EUR Sentix Economic Index (Oct)
11:00: EUR Retail Sales (Monthly) (Aug)
12:00: EUR Eurogroup Meeting
16:00: USD CB Employment Index (Sep)
19:50: USD FOMC Member Kashkari Speaks
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