Turbulent trading in the Wirecard share

Dusseldorf The German stock market started the day weaker on Tuesday. In morning trading, the Dax loses around two percent and stands at 12,269 points.

Even a pleasing info index cannot inspire the market. On the contrary: The positive values ​​apparently invited investors to take profits, the Dax increased its losses.

After the historic low, the mood in the German executive floors continues to brighten. The Ifo business climate index for June rose to 86.2 points from 79.7 points in May, as the Munich Ifo Institute announced on Wednesday. “The German economy sees light at the end of the tunnel,” said Ifo President Clemens Fuest. The managers interviewed by the Ifo assessed their business prospects and – for the first time since the beginning of the Corona crisis – their situation again more favorably than last.

“The worst of the crisis is behind us and the clear improvement in sentiment is fueling hopes of an economic recovery,” say the experts at Helabe. However, it is not yet possible to speak of a return to normality because the index levels are still comparatively low.

The coming trading weeks on the Frankfurt stock exchange are likely to be rather quiet – at least if one takes the turbulent trading trends in the previous weeks as a yardstick.

According to surveys, some investors have missed re-entry, so the Dax still has some room for improvement. But investor sentiment signals that the rally has been slow since mid-March. Behavioral economist Joachim Goldberg, who evaluates the survey conducted by the Frankfurt Stock Exchange, expects profit-taking from a price of 13,000 points. On the other hand, there are no signals that the index will soon crash again.

This also falls accordingly Volatility barometer on the German stock market, the VDax. Compared to the record high in mid-March, this value is almost third, at around 33 percent it is only slightly above the low of the past three months.

This index reflects the fluctuation range of the stock market expected by professionals. The higher the VDax, the higher price fluctuations investment professionals expect in the coming trading days and weeks. The VDax pre-crisis level in mid-February this year was around 15 percent.

“In our core scenario without a second wave of infections, we expect a” tough summer “- a volatile sideways movement with setbacks of up to ten percent,” says chief strategist Bernd Meyer from Berenberg Bank.

On the day on which the previous CEO Markus Braun presented himself to the law enforcement authorities, the Wirecard share achieved the greatest increase in value in a long time. 18.8 percent plus last Tuesday, with a comparatively high trading volume of 17.2 million papers. Around 40 million pieces were traded during the crash days, but the average volume since the beginning of the year has been 3.3 million papers a day.

Trading on the stock is still turbulent on Wednesday. After an increase of eight percent at the start and a price of 19.80 euros, the paper falls back to 15 euros. At the current rate of 16.30 euros, the minus is still five percent. Are hedge funds active that resolve their short speculation?

Because stubbornly and with good timing, the funds bet on falling prices for the Wirecard share. And they remained stubborn at least on Monday of this week.

According to the latest data in the Federal Gazette, your short sale quota continues to be at least 13.95 percent and has only dropped slightly so far. On Thursday, this figure was still 15.2 percent, quotas below 0.5 percent do not have to be reported. Yesterday’s new Tuesday’s data will be released later today.

Shortsellers bet on so-called short sales on falling prices. To do this, they borrow a share for a certain time for a fee and then sell it on the market. Your calculation: If the price drops by the return date, you can buy back the securities on the stock exchange at a lower price.

They draw the difference between the sales and the reduced buyback price as profit. However, if the price rises, the short sellers are at risk of losing.

This shows how much investors hate uncertainty Take Deutsche Lufthansa, for example. Since it has been unclear whether the billion dollar rescue package of the federal government will be accepted by the shareholders, the share has fallen significantly. The paper has lost more than 30 percent of its value since June 9, with a drop of 4.6 percent on yesterday’s trading day alone. Today’s title loses another 1.4 percent.

To make matters worse, nobody knows what major shareholder Heinz Hermann Thiele is up towho rejects the rescue plan. But his plans remain a mystery.

The state rescue plan could have serious disadvantages for Deutsche Lufthansa. A new federal government will be elected in just over a year. And after a change of government, two state representatives could suddenly sit on the board, who generally refuse to fly.

The overseas guidelines are positive: US investors responded with relief to President Donald Trump’s commitment to the trade agreement with China. The indices are rising significantly. And Asian equity markets worked their way up to a four-month high on Wednesday.

Look at the individual values

Wacker chemistry: The SDax value loses around 3.5 percent. Dealers point to a downgrading of Citigroup. The analysts lowered the stock valuation to “sell” from “neutral”.

Europcar: The share rises in Paris by up to 17 percent to a two-week high of EUR 2.78. According to insiders, Volkswagen is in takeover talks with the French car rental company. According to the general market trend, the VW share surrenders 0.6 percent.

Look at other asset classes

Gold is about to break the $ 1,800 mark. The price of the precious metal reached $ 1773 a troy ounce (31.1 grams) today, the highest level in about seven and a half years. The record high of $ 1921, reached in 2011, is still a long way off.

“Gold is a clear winner of the pandemic,” said market analyst Neil Wilson from broker Markets.com. The commodity received support from a weakening dollar and the flood of cheap money from central banks worldwide.

“It is a foregone conclusion that the key interest rates will remain at a low level for a long time,” explained trader Alexander Zumpfe from the precious metals specialist Heraeus. “This benefits gold, which itself pays no interest and is considered inflation protection.”

Because real US interest rates (minus inflation) are negative, banks like Goldman Sachs forecast one Gold price of $ 2000 in the next twelve months.

What the chart technique says

The stock exchanges expect one brilliant economic recovery, at least for technology stocks. There is no other way to explain that the US technology indices Nasdaq Composite and Nasdaq have reached 100 new all-time highs.

This has already fueled the German stock market, which yesterday reached a new high of 12.616 points in the past two weeks.

On the bottom offers a Combination of the smoothing lines of the past 200 days (currently at 12,156 points) and 200 weeks (currently at 12,064 points) good support. The 200-day line is an indicator of the long-term trend. If the Dax is trading above a rising 200-day line, investors see it as a positive sign.

Added to this is the upward price gap from last week (12,133 to 11,968 points), which has been successfully tested again and again and was, so to speak, the springboard for higher prices.

Such upward price gaps are often interpreted as a sign of further rising prices and are an important area of ​​support according to chart technology. In this case, the daily low of Tuesday of the past week (12,133 points) is above the daily high of the previous Monday (11,968) of the past week.

As long as this zone of upward price gap and the two lines persists, the bulls remain on the trigger, so higher prices can be expected.

Here is the page with the Dax course, here are the current tops & flops in the Dax. Current short sales by investors can be found in our short sales database.

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