649bruno
Short

DAX: Bearish Divergences Abound In Current Rally, Retest 10,262?

INDEX:DAX   DAX Stock Index
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Part 1 of 2. Part 2 will be the I-Shares-chart for Belgium (to compare strong vs weak charts).
Yes, the-DAX had a strong rally from mid-July to mid-August.
On 09-16-2016 the-DAX low was 10,262.19.
The rally since then has been weak and not nearly as robust at the previous up move.
Negatives:
1. Last valid sell Sell Fractal was Sept 16th at 10,262.19.
2. Your compass for direction, the alligator , is directionless, JAWS CLOSED.
3. CHOP is in the shaded area. This predicts NO TREND.
4. Prices are trading into the Ichimoku Cloud .
5. Prices are mostly below the Ichimoku Cloud baseline.
Positives:
1. Prices are ABOVE the red Ichimoku Cloud conversion line.
2. The-DMI (top indicator) is positive, but the strength is only half of the August rally.
3. The phase energy (top lower) is steadily rising, but BELOW ZERO. It has a downward bias (arrow).
4. No Buy Fractal during rally.
5. The FORWARD PROJECTION (top middle) was strong in August, but VERY WEAK today.

For an estimation of possible FORWARD TRENDING I use the Ichimoku Cloud Senkou Span A (Leading Span A): (Conversion Line + Base Line)/2)). This is the midpoint between the Conversion Line and the Base Line. The Leading Span A forms one of the two Cloud boundaries. It is referred to as "Leading" because it is plotted 26 periods in the future and forms the faster Cloud boundary. I then make an oscillator out of this and plot the progress up and down around a “zero line”. Currently the forward projection is VERY NEGATIVE.
I HAVE THE RESULTS OF THESE CALCULATIONS FOR THE-DAX IN THE TOP MIDDLE INDICATOR. AS YOU CAN SEE, THE FORWARD PROJECTION IS LOWER.
A four hour chart looks slightly more positive, but there are the same negative divergences.
So, I feel the-DAX will be heading lower.
The next chart I publish will be for Belgium. I am doing this so you can compare a strong chart (Belgium) to a weaker one-DAX.
Good luck to you in all your trades. Don.

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