Trading today has, under the circumstances, remained relatively calm, with the DAX breaking through the 50-day moving average following the deployment of Russian troops inside the Crimea. The 100-DMA is also coming into range as the delicate position that Germany and Angela Merkel find themselves in becomes more apparent.
The recovery that is taking place in the EU is still fragile rather than well-embedded, and with Russian gas accountable for 36% of consumption in Germany the recovery could be severely tested.
Another issue that could come to light might be the resilience of any G7 resolutions, as the US has its own gas and energy supplies and can afford to set far tougher sanctions against Russia than its allies who stand to lose considerably more.
What is not really being discussed at the moment is the looming debt burden that the Ukraine has. In a very short period of time it will need to raise around $25 billion in order to meet ongoing costs and liabilities.
Although Germany may be some distance from these troubles geographically, it is likely that they will be feeling the consequences. Although all parties will be working towards a swift resolution and no blood has been spilt yet, it is likely that uncertainty will hang over the markets for some time. Further weakness in the DAX appears likely.