Courtesy of Chris Kimble.
Is the DAX index from Germany about to send a bearish message to stocks in Europe and the States? Sure could!
This chart looks at the DAX over the past 9-years. It’s spent the majority of the past 8-years inside of rising channel (1), creating a series of higher lows and higher highs.
It looks to have created a “Double Top” as it was kissing the underside of the rising channel last year at (2).
After creating the potential double top, the DAX index has continued to create a series of lower highs, while experiencing a bearish divergence with the S&P 500.
The rally off the bottom of rising channel (1) hit falling resistance at (3), which looks to be near the top of a potential bearish rising wedge.
If the DAX breaks support at (4), it most likely will be sending a bearish message to stocks in Europe and the States. Stock bulls in Europe and the states have their fingers crossed that support holds at (4)!!!
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