As sentiment in Europe is hurt by the rising rates curve and a stronger currency we ask is the run in Germany over?

germany-6Today German equities traded through the May lows and are now seeing an increased downward sloping 50dma a similar set up from July 2014 which forebode a major fall in the DAX to 8400 in October and laid the foundation for a rally into year end and well into April.

Sentiment as measured by the RSI is testing lower 30band. The 1yr chart shows where EU and German sentiment overshot in August and October. 

10,000 looks like the key support on the DAX and one to play for. Also if you are a US Dollar based investor its difficult to se how the Euro isnt going to trade lower and put more pressure on a $EWG investment. Own Germany via the $HEWG (hedged) but wait until we get to the next level lower in the index somewhere around the 200dma. Germany is actually readying for another charge higher but clearly is under pressure on the charts.

Chart_ .GDAXI

 

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