Who needs to ride a roller coaster if you are invested in stocks, right? That was quite a speedy right last week. The DAX dropped back to the level of Summer 2013.
As we discussed the last weeks that was certainly not done by Joe the plumber and his retirement plan. The political problems like Ukraine are certainly not the answer as well. For those who are able to read German we recommend to read Handelsblatt Online. Their search for answers are always very entertaining. Today we could read the world economy or better the stock market is still on risk next week because China's economy will only grow by 7.2 % instead of 7.5%. 7.2% a year means still 100% or double in 10 years. Where did they go to school? They also said the upwards trend is now over. Which trend, since January the DAX goes to the site, right?
We heard the sell off was due to hedge fonds who like to change their portfolio during the earning season. That sounds more valued to us then the shovel in the port of Hamburg. We could see an improvement already on Friday. After the German market closed the US market went up until midday and losing a bit in the afternoon. 6.99% for Alcoa, what a day. The commends of FED members that they might not increase so early the rates certainly helped.
Nevertheless let us talk about the DAX companies. Are they going to rebounds next week or do they continue to fall to the South? According to the indicators we use no company is good for an investment. There are no DAX companies with DI+ above DI- and the majority does not have an MACD crossing the tricker to indicate a trend change. We normally base our indicators on 14 days but even change into 5 days does not change the picture. The change of Friday does stand on pretty unstable ground.
The best we can find is Continental.
According to PVI "clever money" is going in, MACD crossed the tricker and changing the DI down to 5 days instead of 14 days will give us a buy signal. The chart is back into his negative trend channel and could be good for 10 Euro's.
While we can see a similar development by Volkswagen and Lufthansa we think it is to early to make a statement. We have to wait a few more days.
but as always: just my 5 cents.....
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