As with every third Friday of every month, today is a special day due to the expiration of options and futures contracts in the financial markets. This Friday is especially important because, being the ninth month of the year, not only monthly contracts will expire but also quarterly contracts. So, during today’s session we will be witnessing what is popularly known as the “quadruple enchantment hour”.
However, without a doubt, the main focus of the day, and for what you will remember today’s session, is the end of the popular DAX30 index. As announced several months ago, from Monday 20 September, the German index will trade with 40 companies, thus becoming the DAX40. “The king is dead, long live the king!”
As we announced just a few days ago, the following companies will join the current 30 in the index:
- Airbus SE
- Zalando SE
- Siemens Healthineers AG
- Symrise AG
- HelloFresh SE
- Sartorius AG Vz
- Porsche Automobil Holding
- Brenntag SE
- Puma SE
- Qiagen NV
Their acceptance into this important index is not a trivial event. The companies may experience high volatility during the upcoming sessions due to the fact that the funds and ETFs that track this index will have to acquire shares of these companies and readjust their holdings to match the composition of the new index. It will therefore be interesting to check out these companies over the next few days.
It looks like the DAX30 will bid farewell to its old format by facing its 18-session moving average in white, with its significant support / resistance level represented by the orange band. It is important that the price breaks this level to gain momentum in search of the low trend line, which started in mid-August after a record high, because as long as the price is not able to surpass this trend line, the sentiment will remain negative.
Conversely, a failure to break above its current resistance level could trigger a bearish rebound in search of its monthly lows. The loss of this level could lead the price to seek its significant support level at 15,300 points represented by the upper red band.
Evolution of the last five years:
- 2020: 3.6%
- 2019: 25.48%
- 2018: -18.26%
- 2017: 12.51%
- 2016: 6.87%
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