Dax and imminent rebound

Obviously we will see some kind of a rebound tomorrow even the intermediate term trend is about to turn down.

50 day cycle just gave a sell signal.

Dax McClellan Summation Index already made a negative divergence with the underlying index. Currently it is heading down.

It is highly probable that Dax will fall at least below 7200, and then appropriate short term target could be found from a weekly chart. So far Fibonacci level 7037 seems to be enough, maybe even below 7000.

Dax week 34

Dax seems to turn on the bears side. Closing below declining trend line isn't good in this situation. On a weekly chart Dax 6594 seems to be the downside target. Stochastics indicator already gave us a sell sign.

Short term trend is down according to risk behavior. This could mean few down days, then followed by a rebound and then more down.

Longer term trend indicator also gave us a sell sign. 

The mood became bearish, so let's see if there will be some kind of a topping process or a pullback. September has, by the way, been one of the most bearish months in a year. A healthy pullback and Fed announcement of QE3 seems to be the name of the game.

Thoughts about Dax and the current trend 19.5.2012

Dax is flirting with the lower bottom of declining trend. Apparently, Fibonacci 50% and 200 days moving average should have their impact on forthcoming week. It could be reasonable to assume the trading range between 6200 - 6400.

Eur-usd rebounded from lower low which was should be very important support. Therefore, we can expect more rebound before testing the low again.

Some of the indicators still point down even the latest behavior of Volume index hasn't been exactly in unison compared to price index (Dax).

McClellan has been quite reliable and clear indicator to reveal longer trends.

Also Overbought and Oversold condition doesn't look like it would turn right now.

Risk behavior suggests that we could soon be nearing the bottom, and so far this indicator is at reasonable level compared to prices and we only need one single day to turn this indicator up.

We also need the high correlation level to lower first before any big trend change could happen.

Overview: The evidence shows that the intermediate term trend is still down, but there are some minor observations in the investor behavior that suggest some hesitation and at least short term rebound. The question remains if the rebound will also act as an intermediate term market bottom. The big question is whether the institutions and block traders shall join this sell-off, and thus driving the prices even lower, since now these major participants have stayed on the sidelines.

Dax indicators 28.3.2012

Yesterday's call for a rebound canceled. It is not wise to try catch a falling knife at this point. There are evidences that we will see lower lows and lower close ahead. 

Dax volume indicator trying to lead the prices down.

It is always bearish when Accumulation/Distribution falls into negative territory...

...combined with investor's reduced willingness to take risk it almost guaranteed that Dax will have lower close during next 5 days.   

Dax Cycle is trying to point down.

McClellan Summation Index is already bearish.

The most important level tomorrow is 6974 and 7050. Below those levels we remain bearish and keep 6600 as our 5 day target.

Today Dax could climb above 7000 (target 7016), but eventually fall below 6900 (target 6895).

Dax indicators 7.3.2012

Dax failed twice to get through 76,8% Fibonacci level. Yesterday's rebound was highly expected, but if this was double top reversal, then it would give 6487 as our next downside target.

Dax Volume Index made lower close two days ago. Additionally, this was 20 day low which indicates...

...over 90% probability that we would see another lower close in Dax during next 3 days.

McClellan SMI is indicating a downtrend.

20 day highs vs. lows is indicating a downtrend.

Dax resistance / support 12.1.2011

Dax broker up the descending trend line and has now been trying to push up through strong resistance area 6170-6190 and Fibonacci at 6203.

In a shorter term it looks that Dax should go lower (and attract more institutional investors to buy) if it wants to go higher. 6050-6080 would be fine. Below 6000 the picture is starting to look bearish and the gaps up  would have a exhaustion meaning and confirmation for a trend reversal.

I have been watching US markets closely lately, because it is obvious that is has been keeping the stock market up. S&P500 has already made higher level and is now trying to push up even this would be perfect level to make a trend reversal.

It also seems that money inflow hasn't been strong anymore. Money outflow at these important resistance areas could definitely trigger a decline in stocks.

Dax sentiment week 2

Dax hasn't been able to make a higher high after 3rd January. Weekly seasonality favors bears for the next 2 weeks. Short term view looks like drop under 6048 would be bearish. Until then we would more likely to see range trading between 6048-6169. There is also strong resistance at previous month highs between 6170-6193. Aggressive break up through that level, would lead the index to near 6400.

The volume dropped at it's lowest levels for ages. It seems that nobody wants to do a move until we get some good or bad news. Anyway, the prices can go up with low volume, but the the prices will definitely come down with high volume. Thus, the current situation needs cautiousness.

Again, the volume index based on volume calculations from individual stocks made lower close. According to my backtesting, this would give 95% probability that Dax index would make lower close during the next 5 days.

...on the other side, volume index 20 day lows have usually marked some kind of a short term market bottom. So, we will watch carefully if volume index will make another low today.

Volume accumulation / distribution is on the negative side.

Trin is on the negative side, which means that declining stocks have been getting more volume.

McClellan Summation Index hasn't yet turned. Usually the indicator is quite autoregressive and smooth. So until it turns down, we are waiting and not making any aggressive moves.

Overview: volume studies are more bearish than bullish. Seems like Dax is currently making a short term top which will take some time. After that it is possible that we will see a violent pullback below 6000 and towards 5500. Before breakdown below 6048, it would be wise to wait and stay in cash. If the index will advance over 6300, it would be good opportunity to go short.

Dax short term 2.1.2012

In simple graphical terms, seems like Dax is in very interesting situation. 61,8% Fibonacci and the upper descending trend line have been reached at the same time. Obviously we have to get some good news to help Dax break up. Otherwise, when we will fall from this point, the bearish signs I earlier mentioned are becoming stronger. I try to be very objective, but there are already some bearish signs and the upcoming weeks haven't been historically bull-friendly, so extra cautiousness at the moment is very much needed.

Dax intraday 22.12.2011

Break and closing above 5898-5900 would make 6024 as a short term target. If we cannot decisively break the declining trend line and fibonacci, the market has to pull back to try another time.

Dax long term update

Dax long term picture negative

Dax long term

This situation reminds me of January 2008