German 30 (DAX) Forecast: Key Support at 18,630 as Index Tests Bullish Channel

Market Recap: Friday’s Stock Performance

Germany’s stock market closed lower on Friday, as declines in the Technology, Transportation & Logistics, and Pharmaceuticals & Healthcare sectors drove the overall indices down.

The DAX Index, Germany’s benchmark stock index, experienced a notable decrease of 1.43%, closing the session at 18,730. Simultaneously, the MDAX and TecDAX indexes also ended the day on a negative note, dropping 1.54% and 2.27% respectively.

The market’s downward trajectory was largely driven by sector-specific losses, with some of the country’s most prominent stocks enduring significant sell-offs. The healthcare and technology sectors, in particular, faced sharp declines, contributing to the broader market’s slump.

Best and Worst Performers on the German 30

Amid the market’s overall decline, several companies managed to defy the broader trend, posting gains or limiting losses. Here’s a breakdown of the top performers and the biggest laggards within the DAX Index.

Top Performers:

• Deutsche Boerse AG (ETR: DB1Gn): Leading the pack, Deutsche Boerse AG rose 1.51%, or 3.10 points, closing at 208.20. This surge reflected the stock’s continued resilience despite sector-specific weakness.
• MTU Aero Engines NA O.N. (ETR: MTXGn): Posting a modest gain, MTU Aero Engines saw an increase of 0.80%, adding 2.20 points to end the session at 278.50.
• Siemens Energy AG (ETR: ENR1n): While the broader market faltered, Siemens Energy managed to gain 0.78% (0.25 points), reaching 32.30 at the close. Notably, this gain pushed the stock to a 3-year high.

Worst Performers:

• Sartorius AG VZO O.N. (ETR: SATG_p): Among the worst hit, Sartorius AG plummeted 6.90%, losing 17.10 points to close at 230.90. This significant drop underscored the vulnerability of the healthcare sector.
• Mercedes Benz Group AG (ETR: MBGn): Mercedes Benz Group shares hit 52-week lows, falling 6.81% (4.02 points) to finish at 54.99.
• Brenntag AG (ETR: BNRGn): Another notable underperformer, Brenntag AG sank 5.91% (3.86 points), ending at 61.48, which also marked a 52-week low for the company.

MDAX and TecDAX Performances: Insights into the Mid-Cap and Tech Sectors

The MDAX Index, which tracks Germany’s mid-cap companies, saw similar downward pressure, with most stocks following the broader market’s trend. However, a few stocks managed to escape the selloff, albeit with minimal gains.

MDAX Top Performers:

• LEG Immobilien AG (ETR: LEGn): Gaining 0.17%, LEG Immobilien ended the day at 92.16, showcasing stability within the real estate sector amid market turbulence.
• Tag Immobilien AG (ETR: TEGG): Despite closing unchanged at 15.95, Tag Immobilien managed to avoid the sharp losses seen elsewhere.

MDAX Laggards:

• Puma SE (ETR: PUMG): Puma SE was one of the worst performers, plummeting 6.47% to close at 35.27, reflecting broader weakness in the consumer goods sector.
• Jungheinrich AG O.N. VZO (ETR: JUNG_p): The industrial company suffered a 5.51% decline, ending at 25.74.
• Evotec AG O.N. (ETR: EVTG): The biopharmaceutical company lost 5.36%, closing at 6.01.

Meanwhile, the TecDAX Index, which tracks the performance of Germany’s technology-heavy companies, also experienced significant volatility:

TecDAX Top Performers:

• Atoss Software AG (ETR: AOFG): Atoss Software posted a gain of 1.25%, closing at 129.80, showing resilience amid widespread tech sector losses.
• SUSS MicroTec SE (ETR: SMHNn): SUSS MicroTec also saw a slight increase of 0.71%, finishing at 56.90.

TecDAX Laggards:

• Sartorius AG VZO O.N. (ETR: SATG_p): As mentioned earlier, Sartorius also tops the list of worst performers in the TecDAX, with its 6.90% decline.
• Elmos Semiconductor AG (ETR: ELGG): The semiconductor manufacturer lost 6.55%, settling at 64.20.
• Infineon Technologies AG NA O.N. (ETR: IFXGn): Closing down 5.72% at 29.07, Infineon’s decline reflected broader challenges in the semiconductor industry.

German 30 (DAX) Technical Analysis: A Critical Crossroads

From a technical perspective, the DAX Index is hovering near a critical level, trading at approximately 18,730. This point marks the lower bound of an upward channel that has persisted in recent sessions.

While the index remains within this channel, recent price action suggests that the bullish trend is beginning to wane, with potential signs of bearish momentum on the horizon.

Key Resistance Levels:

• Immediate Resistance is located at 18,852, which represents the first hurdle the index must overcome to resume its upward trajectory.
• Further Resistance levels lie at 19,001 and 19,167, both of which could serve as significant barriers if the index manages to rally.

Critical Support Levels:

• On the downside, Immediate Support can be found near 18,636, which is aligned with the 50-day EMA (Exponential Moving Average), a critical technical indicator. Should the DAX break below this level, it could lead to a more substantial correction.
• Additional Support levels exist at 18,490 and 18,341, with a break below these points potentially signaling a deeper bearish move.

Technical Indicators:

• The Relative Strength Index (RSI) is currently sitting at 59.96, hovering near neutral territory. This suggests that the market is neither overbought nor oversold, leaving room for both upward and downward movements. A rise above 60 could indicate renewed buying interest, while a drop below 50 could confirm further bearish momentum.

Conclusion

Despite Friday’s losses, the overall market trend remains mixed, with some companies and sectors showing signs of strength amid a broader downturn. Investors will be closely monitoring the DAX Index as it hovers near crucial support levels.

If the index can hold above 18,730 and push past 18,852, it could signal a continuation of the bullish trend. However, any break below the 18,636 support level could trigger further declines.