The US labor market remains a key consideration for the Fed, grappling with a robust labor market and elevated inflation.
Other economic indicators, including the Philly Fed Manufacturing Index and housing sector data, will likely play second fiddle to the labor market data.
In the near term, DAX trends will hinge on geopolitical tensions, central bank commentary, and US labor market data. Hawkish Fed comments, rising geopolitical risk, and upbeat US labor market data would likely weigh on the DAX. Conversely, easing tensions about the Ukraine war, support for December ECB and Fed rate cuts, and softer US labor market data may push the DAX higher.
As of Thursday morning, futures signaled a mixed session. DAX futures advanced by 47 points, while the Nasdaq mini futures were down by 71 points.
Investors should closely track the Ukraine war-related updates, US economic data, and central bank commentary for market cues.
After three consecutive daily losses, the DAX sits below the 50-day EMA while holding above the 200-day EMA. The EMAs signal bearish near-term but bullish longer-term price trends.
A DAX breakout from the 50-day EMA could signal a move toward 19,350. Furthermore, a return to 19,350 may enable the bulls to target 19,500 and the DAX's all-time high of 19,675 into play.
Key drivers include updates on the Ukraine war, US economic data, and central bank commentary.
Conversely, a DAX drop below 19,000 may signal a fall toward 18,750.
With the 14-day RSI at 44.59, the DAX may fall through 18,750 before entering oversold territory.