Dax sentiment 24.5.2012

According to indicators, we have a little evidence of reliable market bottom yet. So far the trading range of 6200-6400 has proven to be reliable. Dax hasn't yet touched it's 200 days moving average which is holding the key level near 6200. It is highly expected that we could at least visit 6150-6180 before forming any reliable (tradable) market bottom.

Dax sentiment 10.5.2012

Did anyone thought that the situation with Greece is over? People jeopardize Greece's Eurozone membership and investors seem to be a little bit more worried.

the source: www.cognitrend.com

Dax sentiment 26.1.2012

Risk/reward

Commerzbank has obviously been the strongest performer during last 20 days.

However, only a little bit over 40% of the stocks have performed better than the index during last 20 days.

Rarely all the stocks are performing positively during 20 day period. Now we have 27 positive performers.

20 day highs divided by lows has been positive too long.

Dax cycle seems to be a little bit high, maybe we are topping soon.

Sales have become stronger lately even the buying has remained high.

Trading volume has been increasing lately.

McClellan Summation Index has been leading the way up. We haven't reached the extreme level yet and anything is possible before the indicator will begin to decline. 

Although, TRIN has been negative already 3 days in a row, which means that the investors have been selling more than buying at these levels.

The moving average of Trin also turned negative. Even it is possible that the market could rise a little bit, the probability of short term market top has been rising. Previous similar cases with Trin has been marked in the below graph.

Overview: at the current situation, the risk for the downside correction is higher than the upside reward. Sentiment has been cautiously bullish for some time, but the economic risks haven't been resolved. The market will become exhausted. So, for now on, during the next 1-2 months we should see correction to 6000, or if the market cannot find any good reason to sell, at least consolidation. It would be wise to step out of long positions or aggressive traders could begin to build their short positions.

Dax sentiment week 51

Symmetrical triangle

Dax has been forming a symmetrical triangle. Now, we are waiting for a break out. This could be a little bit bearish, but I am not counting too much into that. Dax finally managed to get above 5767-5771 and yesterday it offered plausible support. So, if Dax cannot manage to break the declining trend line at 5890-5900 (or the upper at 6090) and begins to build a descending triangle, this would be bearish sign. This would be verified if Dax will re-test 5767-5771.

20 day highs vs. lows seems to be in a neutral zone. Thus, no trend here.

Currently 20 day stock performance is a slightly bearish, but when this indicator rises the odds for the bulls are also rising.

Again, overbought / oversold condition have no clue about the direction. No clear trend here either.

Dax cycles is also stucked at the neutral zero zone. However, it has made a lower low recently, which could indicate lower levels to the Dax. Apparently this could take 1-3 months.

 Same here with volume index which made lower lows. If the underlying situation is leading Dax and the politicians won't manage to manipulate the stock market, now it seems to be wise to trade in a triangle / range and wait the big move after the break out has occured.

According to Cognitrend sentiment studies, the optimism among Dax investors is at the highest level. Should I be concerned?

Dax sentiment week 40

Contrarians push for a stock market rally

Selling has decreased continuously as can be seen from the above graph. It is still expected that buying would wake up investors interest. Soon we could be in a good phase of optimism. The law of inertia usually brings the green and the red line together and that is about to happen sooner or later. When we see green buying indicator increasing, the index could surge strongly for a while.

The individual stocks are still broadly performing better than the index. Usually this has marked the short term market bottoms.

 Yesterday, we didn't see any 52-week lows, which is a good sign.

Dax sentiment 23.9.2011

Buying still lagging

It is obvious that investors are not buying stocks at the situation. The sellers became again aggressive yesterday thus making the index close almost -5% lower. During this week, we have seen 3 new 52-week lows: Deutsche Post, Lufthansa and Thyssenkrupp. The chart below tells the story about bulls and bears: if the buying indicator (green) won't start to climb soon, the bears are in control.

 

Index has been dragged down by fewer and fewer stocks that has been very heavily sold, especially banks. However, 60% of stocks have been performing better than the actual index. This seems very promising if we want to find short term bottoms, even this ratio can go much higher as can be seen during the 2009 lows.

 

According to survey made by Cognitrend the sentiment of Dax investors have been positive.