DAX 40, AUD/USD and copper try to stem their decline
Technical analysis of the DAX 40, AUD/USD and copper as they try to stem this week’s decline.
Macro update
Asian markets tumble:
South Korea’s KOSPI sank 6.2% - its steepest drop in over a year - as technology stocks led a sharp regional sell-off and enthusiasm over artificial intelligence (AI) cooled.
Tech slump widens:
The MSCI Emerging Asia Index fell 2.6%, with Samsung, SK Hynix, and Taiwan Semiconductor Manufacturing Co (TSCM) sliding amid stretched valuations and weaker US semiconductor guidance.
Japan sees heavy losses:
The Nikkei 225 dropped nearly 7% from its recent record high, while SoftBank plunged more than 10% as investors booked profits.
Political uncertainty weighs:
European futures turned lower after Democrats secured surprise victories in US elections, rattling confidence in the Trump administration.
Wall Street turns cautious:
Warnings from Goldman Sachs and Morgan Stanley over overheated AI valuations further fuelled global risk aversion.
DAX 40 is trying to find support
The DAX 40 is trying to bounce off minor support on an intraday basis but overall remains under pressure.
While it stays below Monday's 24,248 high, it may retest its mid-October low at 23,685. If fallen through on a daily chart closing basis, the area between the June-to-September lows at 23,483-to-23,052 may be revisited.
Immediate resistance sits at the 10 September high at 23,883.
DAX 40 daily candlestick chart
AUD/USD tries to hold at support
AUD/USD swift drop seems to have at least temporarily ended at Wednesday's $0.6459 low, made marginally above the 14-to-17 October lows at $0.6444-to-$0.64441. While this support area underpins, a recover towards the late September low at $0.6521 may ensue.
Were support at $0.6444-to-$0.64441 to give way, though, the August lows at $0.6420-to-$0.6415 would likely be back in the frame.
AUD/USD daily candlestick chart
Copper tries to level out
The price of copper, having come off its $5.2788 late October three-month high, is trying to level out around its mid-October and Tuesday lows at $4.8908-to-$4.8840. While this support area holds, a bounce towards the 6 October low at $5.0145 may be on the cards.
Failure at $4.8840 would likely lead to the 200-day simple moving average (SMA) and the 10 October low at $4.8638-to-$4.8225 being revisited.
Copper daily candlestick chart
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