IBEX 35, DAX 30 Forecasts: Bears Take Control As COVID-19 Fights Back

Fibonacci levels continue to be of key importance to measure the progress of the recovery from coronavirus lows, so further pullbacks towards the 38.2% % Fibonacci (7,442) may take place before we see bullish momentum take over again. On the upside, the 8,000 is likely to have turned back into key resistance, followed by the 20-day moving average at 8,155.

IBEX 35 Daily chart

IBEX 35, DAX 30 Forecasts: Bears Take Control as Covid-19 Fights Back

DAX 30 Technical Outlook

Following the IBEX 35 closely are German equities, as the DAX 30 is down around 2.3% so far today. Last week I mentioned that the DAX was in a risky position as it had become massively overbought, and the index was ignoring the grim picture at home where coronavirus infections are getting out of hand.

Today’s reversal is getting the index closer to its true value, but I suspect we still have further corrections to come before we can consider the DAX 30 t be fairly valued. For now, the index seems to have found short-term support at the 13,315 area, although the true test of support for me will be at the 13,000 mark. A fall below this area is likely to bring further corrective pressure, possibly testing the 12,290 area, whilst firm support could see the index bounce back into the new year.

DAX 30 Daily Chart

IBEX 35, DAX 30 Forecasts: Bears Take Control as Covid-19 Fights Back

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