Dax Index Bullish Flag Suggests 15,000 Soon

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Written By: Mircea Vasiu

Nov 20, 2020, 11:41 GMT 11:41

DAX index

Summary:

Dax index potential bullish flag points to a move to the 15,000 level. The ECB decision is key for the next leg on the Dax.

Dax index is on a tear higher. Ever since the US elections ended, the Dax followed the US equities higher. After that, the positive vaccine news was responsible for yet another leg higher in the index.

At this point, it consolidates just below the 2020 highs. However, in doing so, it shows bullish signs. First, the consolidation forms on the horizontal. Second, it follows a vertical rise. Therefore, this may easily turn out to be a bullish flag with a measured move pointing beyond the 15,000 level.

More Stimulus from the ECB

So far, the Dax index moved higher on the back of a lower USD. The logic behind the statement is that a lower USD triggered higher US stocks. In turn, higher US stocks triggered a higher Dax index.

However, this may easily change. The ECB is expected to come in December and further ease the monetary conditions. If that will be a game-changer for the Euro, it may trigger the breakout out of the bullish flag.

Dax Index Technical Analysis

To trade the flag, bulls may want to wait for a break above 13,600 before going long for 15,000 while having a stop at 12,600.

Dax Index Price Forecast

Written By: Mircea Vasiu

Mircea, MBA in International Business graduating Magna Cum Laudae, trades for a living and contributes to various financial publications for more than six years. He writes about macroeconomics, stock indices, currencies, and most recently ETFs and individual stocks. For the past decade, he’s involved in everything trading related, mostly in the currency market, both with manual and algorithmic trading.