The DAX index of the top 30 German stocks has sold off recently but is showing support for another push higher.
GER30 – 4H Chart
The price of the GER30 has shown some support at the 24,265 level and could make a break higher soon. If the current level fails, then some larger selling could emerge.
There are catalysts for the German stock index this year, after the recent deal between the U.S. and Europe. The deal will create a 15% tariff for European companies and pay a 15% tariff to the US, a move that will affect some of the biggest constituent companies in the DAX index. Porsche, which is partly owned by Volkswagen Group, will be the most affected company because it counts the United States as a huge market.
The DAX Index is also reacting to actions by the European Central Bank. Unlike the Federal Reserve, the ECB has made several rate cuts this year, bringing the official cash rate to 2%.
German banking giant Commerzbank saw its shares rise more than 130% this year. That was boosted by the news that Italian bank Unicredit was taking a stake. Unicredit has hinted that it would launch an acquisition bid this year or in 2026. The risk, however, is that Commerzbank has become a highly overvalued company as it has jumped by almost 200% in the last 12 months.
A positive mood for global stocks could bring a retest of the 24,600 level.
