DAX 40 (GER40/USD)
The DAX 40 (GER40/USD) is Germany’s leading stock index and a prime barometer of European economic health. It represents the top 40 blue-chip companies listed on the Frankfurt Stock Exchange — from industrial giants and automakers to tech and healthcare leaders. This tutorial will break down how the DAX moves, what drives it, and how you can trade it with precision.
What Is the DAX 40 (GER40/USD)?
The DAX 40 tracks the performance of 40 of Germany’s largest and most liquid publicly traded companies. It includes globally recognized names like Siemens, SAP, Allianz, and Volkswagen — companies that shape not only the German economy but also contribute to broader European and global market trends.
What sets the DAX apart is its unique composition and responsiveness to both European and international catalysts. It’s capitalization-weighted, which means larger companies carry more weight, but still offers a relatively balanced reflection of the country’s industrial and financial sectors.
Why the DAX 40 Moves
The DAX doesn’t operate in a vacuum. Its movement is influenced by both internal eurozone developments and global macro forces. The following triggers consistently shape its price action:
German GDP and inflation data:
These releases affect business sentiment and investor appetite
European Central Bank policy:
Any rate decision or commentary from the ECB can move the DAX significantly
Manufacturing PMIs:
As Germany is an industrial powerhouse, PMI data plays a critical role
Global growth sentiment:
Since many DAX companies are exporters, global demand forecasts matter
Currency shifts (EUR/USD):
A stronger euro can hurt export-heavy DAX firms, while a weaker euro tends to lift the index
Geopolitical risks:
EU sanctions, war news, or shifts in energy supply chains hit the DAX quickly
How to Trade the DAX 40 (GER40/USD)
The DAX can be volatile — especially during overlapping sessions. But it also respects technical structure well, especially when paired with macro confirmation.
Intraday scalpers focus on Frankfurt and London open volatility
Swing traders use German data or ECB policy to play larger macro shifts
Breakout traders capitalize on consolidation ranges following EU economic reports
Confluence setups with EUR/USD movement and equity sector flows work consistently
To trade it smart:
Use London session volatility and watch for NY spillover reactions
Monitor EUR/USD behavior as a sentiment filter
Align trades with Eurozone PMI and CPI data
Watch correlation with Euro Stoxx 50 and French CAC 40 during EU news cycles
Key Characteristics
Volatility
High, especially during EU data or global risk events
Liquidity
Excellent during Frankfurt and London sessions
Correlations
EUR/USD, Eurozone data, EU banking and industrials
Session Behavior
Strong open moves, retracement opportunities mid-session
Best Use Case
Macro swing trading, session open scalps, EU risk sentiment plays
Example Trading Scenario
German CPI drops lower than expected. Traders price in a dovish ECB, euro weakens, and DAX pops. You wait for the structure break, then enter on the pullback.
Entry: Buy at 18,340.00
Stop Loss: 18,200.00
Take Profit: 18,640.00
Risk-Reward: 1:2.14
Clean setup, clear drivers, and structure alignment. That’s how you trade the DAX.
Summary Checklist
Asset Type: Index
Symbol: GER40/USD
Volatility: High
Correlated With: EUR/USD, EU data, German economy
Best For: Session open volatility plays, macro news trades, PMI setups
Frequently Asked Questions
What is the DAX 40 (GER40/USD)?
It’s Germany’s main stock index, tracking 40 of the country’s largest and most influential companies.
When is the best time to trade the DAX?
During the Frankfurt and London sessions, especially around German and EU economic releases.
Why is the DAX sensitive to EUR/USD?
A weaker euro makes German exports more competitive, which boosts DAX performance. A strong euro has the opposite effect.
Is the DAX more volatile than the S&P 500?
Yes. It moves faster during news cycles and responds strongly to European data surprises.
What is the average daily pip movement of GER40/USD?
The DAX typically moves 300 to 800 pips per day, often spiking past 1,000 during major EU announcements.