May 20

DAX Longer term view

So DAX had an amazing year so far rising up in an euphoria move here in 2015. However on the longer term basis there are stuff I see which makes me very nervous about Europe markets , just as US markets.

1. As I see it , cycle wise we might be close to a major top , not just a small one.

2. The sentiment past many months on DAX has been , we can only see small correction before going higher , nobody really expects any further sell off than a small bump before we go higher. (So sentiment is bullish)

3. Also we have margin debt at highest level which is usually a bearish signal if we look at it longer term , people borrowing like never before to speculate in mkts – not safe imo for longer term players.

4. We got clearly 5 waves up from the lows on DAX too , arguing for possible 12-13.000 on DAX being a bull market top (very possible) if its going higher I dont see us go much higher than here.

5. We are entering the worst 6 months statistical and this could also bode more trouble for mkts as USA has not been going up much in the first best 6 months.

This could VERY possible be a TRANSITION from bull / to bear , people who are unpatient and says why we dont crash here and now , well sometimes it takes TIME , and MONTHS before we start the real sell off. I think especially US mkts had a lot of trouble in the past 6 months going higher with Europe.

 

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