Good morning, traders! We’re approaching the end of the month and it’s been a turbulent ride so far for the DAX. After yesterday’s volatile reversals and heavy intraday swings, today opens with a corrective tone amid softer macro headlines and key technical retests. Let’s dive in.
🗞️ Market Recap – May 28, 2025
🔹 Key Drivers
- European stocks drifted lower after a brief spike in optimism fueled by easing bond yields and a rebound in tech.
- DAX printed a deep intraday recovery, rallying nearly 300 points before retracing all gains into the close.
- ECB comments were mildly dovish, with sources hinting at policy patience despite sticky inflation.
- US economic data showed mixed signs: durable goods rose +0.6%, but consumer confidence dropped to 101.2 vs. 104 est, pressuring risk sentiment into the US close.
🔹 DAX Performance
- Closed slightly down after wild swings: session high near 24,391 and low at 24,024.
- Sellers reappeared near structural resistance, reversing the spike triggered in the early European hours.
📅 Economic Calendar – May 29, 2025
Key Releases Today:
- Germany CPI Flash (13:00 CET) – Expected at 2.5% YoY vs. 2.4% prior.
- Eurozone Confidence Indicators (11:00 CET) – Focus on Economic Sentiment Index.
- US GDP QoQ (Second Estimate, 14:30 CET) – Forecast at 1.4%.
👉 CPI will heavily shape intraday expectations of the ECB. A hotter-than-expected print may spark downside volatility, while soft data might support a bounce.
📊 Technical Analysis – 29 May 2025
🔍 Chart 1: Volume, EMA Cross & RSI
- EMA clusters (short-term) have crossed bearish again around 24,214, rejecting price twice.
- RSI is weak at 41, bouncing from oversold but failing to sustain strength.
- Volume surged during the 03:00 spike, but sellers took control again above 24,300.
➡️ Momentum still favors sellers below 24,180. RSI divergence suggests limited downside may remain.
🔍 Chart 2: Bollinger Bands & ATR
- Bollinger Bands are expanding, confirming increasing volatility.
- Price broke below lower band, mean-reverted and now sitting just below the middle band (~24,175).
- ATR creeping up to 25+, reflecting strong volatility surges in both directions.
➡️ Volatility spike warns of continuation moves—either breakout continuation below 24,100 or reversal back toward 24,300.
🔍 Chart 3: MACD & ADX
- MACD recently crossed bearish with histogram still negative.
- ADX reading: 27.7, supporting a trend-forming environment, though not fully matured.
➡️ Trend strength is building, but not confirmed. Bearish bias remains while MACD stays below signal.
🔍 Chart 4: Support & Resistance
- Major resistance: 24,368 – 24,391
- Key support: 24,088 (previous reaction low), followed by 24,024
- Several lower highs are forming, indicating sustained bearish pressure.
➡️ Break below 24,088 opens path to 24,000 and possibly 23,960.
🔍 Chart 5: 40 SMA with Shift
- Price has dropped back below the 40 SMA shift line at ~24,216.
- Momentum flipped to the downside again after failing to reclaim the trend.
➡️ Medium-term bias favors further pullbacks unless we break above 24,250 intraday.
🔍 Chart 6: Peak Reaction Zones
- Upper reaction zone: 24,391
- Lower key demand: 24,024 – 24,088
➡️ This forms a clean range. Trapped liquidity below 24,088 could trigger a bear trap reversal if bulls defend.
🔍 Chart 7: Daily Pivots
- Pivot: 24,145
- Support levels: S1 23,959, S2 23,839
- Resistance levels: R1 24,265, R2 24,451
➡️ Trading below the pivot tilts bias bearish. Reclaim of R1 would shift bias short-term bullish.
📌 Trading Signal – 29 May 2025
🎯 SHORT Setup (Bearish bias)
- Entry: 24,175 (near current price, under pivot + EMA cluster)
- Stop: 24,300 (above resistance zone)
- Target: 23,900 (near S1, psychological round number)
Risk:Reward = 125:275 → 1:2.2
Use dynamic trailing stops if price breaks below 24,088 with momentum.
📎 Summary
DAX remains under pressure after rejecting the upper peak reaction zone at 24,391. Bearish technicals, weak RSI, a bearish MACD crossover, and expanding volatility support the short-side thesis. Watch German CPI this afternoon as a volatility catalyst. If CPI surprises to the upside, expect acceleration toward the 24,000 handle.
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