DAX Forecast: Stocks Bounce Amid Iran Conflict Developments

Author: Fawad Razaqzada, Market Analyst

Date: March 31, 2026

Market Overview

Equities have shown some stability as reports emerge that the United States may be considering winding down military operations in Iran. However, the ongoing closure of the Strait of Hormuz raises concerns about the global economy, particularly with WTI crude oil prices surpassing $100 a barrel. This situation could lead to a temporary relief in stock markets, but analysts warn it may be a false dawn if energy prices do not decrease significantly.

Impact of Oil Prices

The recent conflict has caused significant market volatility, particularly with Iran's response to US and Israeli strikes, which has effectively blocked the Strait of Hormuz. This disruption has led to a surge in crude oil prices, raising inflation concerns. In the US, petrol prices have exceeded $4 per gallon for the first time since 2022, prompting speculation that former President Trump may seek to end the conflict to alleviate economic pressures.

Key Issues and Market Sentiment

While Trump’s potential move to de-escalate hostilities is noteworthy, the unresolved status of the Strait of Hormuz remains critical. Analysts believe that Iran is unlikely to back down without receiving concessions, and even if the US reduces military engagement, the closure of the Strait could continue to exert economic pressure on global markets.

DAX Technical Analysis

The DAX index is currently testing a significant resistance level between 22,700 and 22,900, an area that previously served as support. The index has struggled to maintain a sustained break above this resistance, and if sellers defend this level, a decline towards the recent low of 21,860 could occur. A more substantial support zone lies between 21,000 and 21,500, which combines previous breakout levels and key Fibonacci retracement levels, making it a critical area to watch.

Conclusion

The outlook for the DAX remains cautious, heavily influenced by developments in the Middle East. Without clear signs of de-escalation, macroeconomic data releases are unlikely to significantly impact market sentiment. Investors should remain vigilant as the situation evolves.