Stock Market Trend: Is the DAX's two-month rise a deceiving trap or a potential buying opportunity?
The German stock index DAX reached a new high of 13,812 points on Friday since June 10, marking a significant milestone in its recent upward trajectory. This surge follows a short-term uptrend that has been forming since mid-July, with its lower boundary today at around 13,600 points.
By midday on Friday, the DAX gained 0.4 percent to 13,750 points, indicating a positive trend that is expected to continue for the rest of the week. However, some market participants voice concerns about a potential bull trap or bear market rally, suggesting that the index may fall to lower levels in the coming days.
The DAX's current sustained break above a certain zone could lead to further upside potential. Technically, the index broke above the 50-day moving average, which is currently at 13,293 points, in early August. For the DAX to reach its potential upside, it needs to break above the 200-day moving average, currently at 14,511 points.
If successful, the potential upside for the DAX reaches up to its June high of 14,709 points. The outlook shows a strong potential for further upside toward and beyond its June highs, supported by ongoing forecasts indicating notable growth in the coming months and years.
The DAX has demonstrated resilience with a 37% year-over-year gain despite some short-term volatility. The index's all-time high was recently recorded near 24,641 points in July 2025. While short-term volatility indicators show some cautionary signals that could signal temporary pressure on the index, the medium to long-term forecasts remain bullish, expecting continued appreciation over the next several years.
Monthly forecasts suggest a range from approximately 22,100 to 25,000 points for the remainder of 2025, with average monthly values around 23,000 to 23,700 points, reflecting steady upward momentum. As of early August 2025, the DAX was trading around 23,758 to 23,846 points—significantly above the 13,800 level—with forecasts projecting increases toward 25,000 by the end of 2025 and potentially reaching 30,000 by the end of 2027.
In summary, the outlook after breaking through 13,800 points is positive, with the index poised to test and surpass recent highs near 24,600 points, supported by broader economic and market confidence reflected in long-term predictions for the DAX reaching as high as 30,000 points by 2027. Short-term volatility may introduce fluctuations, but overall growth momentum is expected to persist.
Investors are keen on the DAX's potential upside, as the index has just surpassed the 13,812 points mark and is approaching its June high of 14,709 points. If the index manages to break above the 200-day moving average at 14,511 points, it could indicate a long-term bullish trend in the finance sector, with the DAX reaching as high as 30,000 points by 2027.
In light of the current bullish sentiment surrounding the stock-market and the DAX's break above its 50-day moving average, some investors might be considering investing in the stock-market, particularly the German stock index DAX.
