DAX reached upper limit of rising wedge - reversal possible

1 feb

When in doubt - zoom out

On Thursday and Friday the DAX / GDAXI reached a high of 21800. Could this be a potential top ?

Looking at the W and M chart (log) the DAX (XETRA) has been trading in a rising wedge since 2003.

With reaching the 21800 level, the DAX has touched the upper line of this rising wedge again. The last time was in April 2015.

The monthly MACD (5 30) has never been this high and the last time the RSI was this high (77) was in 2015 and 2007.

Zooming in on the 5 minute chart (GDAXI), price touched the 21790-21800 region five times in the last two trading days, fell below the current trend line (since Jan 13th), retested it and was rejected to the downside.

There are no certainties in the stock market, but this being at least a local top is quite probable.

6 feb

Nota

redrawn upper line with data in the daily timeframe:
blow-off top ?

8 feb

Nota

just for fun, the time it took from the covid crash to the high in early 2022 as fib extensions. Lines up pretty well with turning points in the market:

8 feb

Nota

rising wedge extended all the way back. crazy...

12 feb

Nota

This current trend (channel) started in early August. Should have seen it sooner:

13 feb

Nota

with fib extensions:

15 feb

Nota

DAX


NDX

17 feb

Nota

wave count back to 1970 redone, should be getting close to the end of wave III of (V) and starting wave IV targeting 18000

19 feb

Nota

rising wedge broken, NDX scenario activated. Waiting for price to bounce to confirm or adjust the fib retracements.

19 feb

Nota

maybe the idea with the fib time extensions for turning points wasn't so bad:


This drop today is a strong indication that the top could be in. The fib retracement on the chart goes to the 2022 low and I'd expect a retracement to the 0.618 (18700) or 0.5 (17400) over the next year.

20 feb

Nota

first bounce at the 0.945 retracement, if we get another one at 21870 I'll be viewing that as confirmation of the fib retracements and the 0.618-0.5 target.

21 feb

Nota

back in the green channel, potential downside targets here 21600 and 21000

1 mar

Nota

Looks like 3 wave ABC correction with ABC subwaves

4 mar

Nota

1000 points up and down again, nice liquidity grab. This is really getting annoying. But if NDX, SPX and BTC can top in a B wave so can the DAX.



This move up and down barely registered on the daily MACD. Expecting more downside.

7 mar

Nota

surprise surprise, the DAX made it to another HH. US indexes tanking but this is in high volatility mode to the upside. Bearish divergence on daily MACD and RSI.



Maybe this is an expanding diagonal signaling trend reversal

8 mar

Nota

daily candles could indicate reversal ahead, but who knows with this index. German defence stocks and SAP were red yesterday.

11 mar

Nota

price hit the 0.908 and 0.945 retracements perfectly. Might be an indication that the move down has finally started.

12 mar

Nota

still trading along the trend lines. Let's see if this really already is the correction in disguise

14 mar

Nota

still very volatile with bearish divergence:

18 mar

Nota

still no obvious bearishness, but the volatility up here is far from normal. Double top.

3 apr

Nota

the trend is down:

3 apr

Nota

log chart, about to go back into the long term structure


similar on the linear chart, weekly MACD about to cross into bearish territory

4 apr

Trade chiuso: obiettivo raggiunto

Goodbye DAX