Courtesy of Chris Kimble.
An important message to stocks in the states will come from Germany in the next few weeks!
This chart looks at the DAX index from Germany over the past 10-years. For the majority of the past 6-years, the DAX has remained inside of rising channel (1). The 2018 decline saw the DAX hit support where a 1-year counter-trend rally started.
Over the past year, the DAX has created a new falling channel (2). It is now testing the top of this falling channel and the lows of last February at (3).
For most of last year, the DAX created a bearish divergence with the S&P 500 after the January highs.
What the DAX does at (3), should send important clues to what the next big move for stocks in the states will be. If the S&P 500 is to have a chance to test last years highs, odds are good it needs to see the DAX breakout at (3)!!!
Keep a close eye on the DAX in the next few weeks friends.
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