The optimism returns to stocks markets backed by China, and the United States that agreed to meet in early October. This Thursday, the two largest world economies accepted to hold a high-level meeting in Beijing.
The meeting was accorded between the Chinese Vice Premier, Liu He, the U.S. Trade Representative Robert Lighthizer, and the U.S. Treasury Secretary Steven Mnuchin.
This Thursday, European stocks market are soaring by the second consecutive day. Euro Stoxx 50 climbs 0.25% reaching 3,480 pts, DAX 30 rises by 12,125 pts or 0.68%, CAC 40 gains 1.05% advancing to 5,590 pts.
Will DAX make it to the 12,500 pts?
The following daily chart corresponds to the DAX 30 index. The big picture shows a higher lows sequence which calls for more upsides. In the short-term, from the August 15 low, we observe a potential wave 3 in progress. The impulsive movement could reach the area between 12,340 pts and 12,470 pts. The bullish scenario will be invalid if DAX closes below 11,575 pts.
Technically, the 12,500 pts area shows a congestion zone which will require increased volatility to support the breakout. If the price action drives the German index to test the psychological level at 12,500 pts, we anticipate a retracement near to the 12,200 pts before surpassing the 12,500 pts and visit 2018’s highs.