Is it all over, though? Might we even be poised for a year-end rally?
Hardly. Or at least it hardly seems that way when we look at the bigger picture I first discussed a few days ago (and a few weeks ago before that).
Well that’s when we look at the bigger picture I posted a few days ago
(and a couple of weeks ago
The Dax seems to be have broken the near-horizontal neckline in a shoulder-(dual) head-shoulder formation. The index broke the neckline last week, finding support at the 200-week moving average and is now trying to crawl back above. This is called a pullback, and pullbacks occur in roughly half of all bearish pattern breakouts.
A correction to 12.075 will take the index back above the neckline, but that doesn’t mean the pattern is broken. We would need a much bigger comeback before saying that.
We can discuss that if and when the Dax breaks 12,500!
The Dax index is in a de facto
technical downtrend on the daily and weekly charts, and on the monthly as well. If we close below this week’s low, brace yourself... further downside is very likely.