Start of yesterday’s session didn’t look like a drama we witnessed in the end of day. DAX futures before 9 AM break above 10,000 pts and we could expect gains. China ended session with gains and EURUSD was getting lower. However faster than most of the markets expected downward scenario happened.
Excuse for drops were troubles of Volkswagen in connection with manipulating in pollution emission in diesel cars. Just yesterday the stock value of company dropped 11B EUR. All German indices went down. DAX -3.80%, MDAX -2.76%, SDAX -2.00%, TECDAX -2.79%. All of DAX30 companies lost value. The biggest drops had car companies: VW -19,82%, Daimler -7,02%, BMW -6,02%.
Wednesday doesn’t look better, before start of the session PMI in China were lower than expected which is another confirmation of weak situation in the country. On daily chart we can see strong downward candle with high volume. 9,300-9,400 area should help bulls to attack, because there is 4-year uptrend line and bottom from August 2015. On the futures chart below there are supports and resistances set. The closest supports are on 9,50 pts, 9,400 pts and 9,320 pts. The closest resistances are on 9,640 pts and 9780 pts.
