Market sentiment took a nosedive on Thursday as the Fed's aggressive tightening path resonated and the Bank of England offered a grim view of the UK economy, expecting GDP contraction in the last quarter of the year.
The German economy avoided a contraction in the first quarter of the year, since last week's data showed Q1 preliminary GDP growth of 0.2% quarter over-quarter, but remains exposed to the implications of the war in Ukraine. Data released earlier today, showed that Industrial Production in Eurozone's largest economy, dropped 3.9% month-over-month in March.
Europe and Germany in particular, are highly dependent on Russian energy imports and the German government has repeatedly pushed backed against sanctions, but has been shifting its stance recently. The European Commission announced yesterday a ban on Russian oil imports, with a plan that will phase out Russian supply of crude oil within six months and refined products by the end of the year. 
GER30 had started the week on the offensive, but the worsening sentiment, prospects of monetary tightening, inflation fears and other risk factors, led to losses on Thursday and the rejection of key technical levels. These include the daily Ichimokou Cloud, the EMA200 and the descending trendline form this year's highs.
Today it comes under renewed pressure and is in danger of further losses below the April low (13,585), although the 13,000 psychological mark seems distant for now.
From a technical prospective, the Relative Strength Index (RSI) moves towards oversold territory, which can contain the index's drop and give it a chance of rebound back towards the EMA200 (at around 14,200), but persistent risk-on mood will be required, for a move above all-three aforementioned technical levels that would pause downward bias.
Senior Market Specialist
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
Retrieved 02 Jul 2022 https://ec.europa.eu/commission/presscorner/detail/en/speech_22_2785