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DAX rebounds as metals recover and Palantir eases AI fears

The DAX opened 1.3% higher amid a buoyant mood, as investors take comfort from a rebound in metal prices and impressive Palantir earnings, which have helped to calm AI-related concerns.

Precious metal prices are rebounding, helping to alleviate concerns after extreme volatility in the metals market unnerved investors at the end of last week and on Monday.

An upbeat mood was seen in Asia overnight, thanks in part to an Indian trade deal with the US.

The US government's partial shutdown may also end soon, with the House of Representatives preparing for a crucial vote on a Senate compromise to end the shutdown.

Palantir’s earnings have also helped to calm concerns over the AI trade. The company is trading 12% higher pre-market after reporting a 70% increase in revenue, reinforcing confidence that its AI strategy is translating into sustained growth and rising profitability.

Other major U.S. tech stocks, including AMD, Amazon, and Alphabet, are due to report this week.

The eurozone economic calendar is quiet today, with attention turning to eurozone inflation figures tomorrow, ahead of the ECB rate decision on Thursday.

The ECB is expected to leave interest rates unchanged at 2%. Inflation hovers around the 2% target, and growth is rising, albeit at a very slow pace.
 

DAX forecast – technical analysis

DAX found support at the multi-month rising trendline and recovered to higher levels above the 25,000 resistance level. Buyers, supported by momentum, will seek to extend the recovery toward 25,500 and new record highs.

Support is seen at 24,675, the October and July high. Below, the 50 SMA is at 24,500, and the rising trendline support is at 24,200, which also coincides with the 2026 low. A break below here creates a lower low, exposing the 200 SMA at 24,000.
 

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Oil falls amid de-escalating geopolitical tension, a stronger USD

Oil prices are falling further on Tuesday, extending a deep sell-off in the previous session amid signs of de-escalating tensions between the US and Iran.

Officials from both countries are due to meet in Turkey for talks this week. The prospect of immediate U.S. military action against Iran has subsided as negotiations on a nuclear deal are imminent. As a result, the risk premium on oil has faded, bringing prices lower.

The market will closely follow the talks, and oil prices could rise if the talks break down.

Elsewhere, President Trump has agreed to reduce tariffs on India to 18%, down from 25%, in exchange for India halting purchases of Russian oil. This means India will be purchasing oil elsewhere, which could, over the long term, drive up prices.

A stronger U.S. dollar is also weighing on oil prices. The US dollar has recovered from four-year lows last week, helped by Kevin Warsh's nomination as the next Federal Reserve president and by stronger-than-expected US ISM manufacturing figures yesterday.
 

Oil forecast - technical analysis

After breaking out of the falling channel, Oil prices encountered resistance at 66.48 before rebounding to test the 200 SMA support at 62.25. The receding bullish bias on the MACD supports further downside.

Should sellers take out the 200 SMA support, this opens the door to the 60.00 round number before exposing the 50 SMA at 59.00. A break below here negates the near-term uptrend.

Should the 200 SMA support hold, buyers will look to recover above 65. A rise above 66.50 creates a higher high, bringing 70.00 into focus.
 

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