At the end of May, we observed that the German stock index DAX 40 (Germany 40 mini on FXOpen) was outperforming many global equity benchmarks. At the same time, we identified the 24,100 level as a major resistance zone.
Now, two months later, the chart indicates a growing bearish sentiment.
From a technical perspective, the DAX 40 (Germany 40 mini on FXOpen) has been trading within an ascending channel throughout July (highlighted in blue). However, repeated attempts to break above the 24,460 mark—aligned with the May peak—have consistently failed.
The pattern of reversals (marked by arrows) is particularly telling: each time, the price dropped sharply with little to no rebound, suggesting firm selling pressure. This behaviour points to a possible reduction in long positions by large market players near the all-time high.
On the fundamental side, several headwinds are contributing to the index’s weakness:
→ Lingering uncertainty over the unresolved US–EU trade deal, with the negotiation deadline fast approaching;
→ A series of weak earnings results from key German firms such as Puma, Volkswagen, and others.
Taking these factors into account, there is a reasonable likelihood that bearish momentum could drive a breakdown below the ascending channel’s lower boundary.
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