German DAX week of November 2nd; Allianz, Merck, Siemens, Volkswagen, Lufthansa

We did not write a block last weekend. Too many things happened in October and we were so stressed the other week about the jump of the stocks to the South. Keeping or not keeping the stock was the question. Was that only the hedgefonds rearranging their portfolio or did we get finally the doom days German Newspapers like Handelsblatt Online are talking about since January?

We decided not to sell our stocks and were quite pleased how the stocks jumped straight back to the north and developed a nice profit for October. Nevertheless it could have been significant more if we would have followed strict our trade system and would have sold after our investment got a sell signal.  Next time....

How does the DAX look like?

The chart shows very well the October disaster. The index is on his way to the north. Where will he create again a sell signal. Is he going back to the 9,700 points like all the time during 2014? Or will this time the peak be lower and finally confirm a negative trend as we can see in the chart by the blue lines?  But the Dollar gets stronger, Euro weaker and the Germans can export to the States instead of Russia.

Let us speak about specific companies in Germany.

Allianz we discussed in the past. We still see this company on the winner site. The 200 days curve was crossed indicating the development is getting stronger.

All indicators showing us it will get better but the DI has not confirmed the buy signal yet. We will see if the momentum is good enough to push the stock higher.

Another candidate is Merck.

All indicators suggest the paper is a buy. The stock is in general in a positive trend channel, something the majority of German stocks can not say.

Siemens is another example where we can see it is not sure were the DAX will go during the next weeks.

The stock went all year long to the side and was falling in October out of the channel. All indicators are looking good and we expect the chart to go back into his channel. If not we will see the DAX falling again to the South.

An example for a risk that the DAX will fall again is Volkswagen.

The stock is in a negative trend since July and we are not sure if the last rebound has enough momentum to change the direction.

In the past we spoke about  Lufthansa. Nothing changed our opinion about this company.

The development of the last weeks confirmed our opinion. The pilots are still on their difficult to understand early pension trip and we only hope the management shows some backbones. Changes are done too late like the implementation of a better Economy Class set up by American Airlines nearly a decade ago. As we said in the past we are sure we will see the single price digit again.

But as always: just my 5 cents.......