DAX eyes all-time high as Jackson Hole caps the week

The DAX is poised to extend its gains at the start of the final trading session of the week and could now challenge the 26,500-point mark.

The lead from US and Asian markets remains positive, although short-term upward momentum is beginning to fade somewhat. Investors are taking profits particularly in semiconductor stocks. This does not fundamentally change the positive sentiment, but suggests that some parts of the market have become overheated. The broader uptrend remains intact. The challenge now is to identify the stocks still capable of keeping pace with the market’s rapid advance, while avoiding those that may already have exhausted much of their near-term upside.

Consumer prices in the Tokyo metropolitan area rose broadly in line with expectations, helping to ease inflation concerns somewhat. In the United States, attention will turn to the Chicago PMI before the week culminates with Fed Chair Kevin Warsh’s speech at the Jackson Hole central banking symposium.

From a technical perspective, the DAX now faces an initial hurdle at 26,500 points. Just over 70 points above that level lies the all-time high, which could come within reach before the weekend.