This chart looks at the DAX index from Germany over the past 20-years. As mentioned above, even though this important index has traded sideways for the past 18-months, its long-term trend remains up.

While the DAX has been trading sideways for the past year and a half, it could be creating a head & shoulders topping pattern at (2).

The softness in the index has it currently testing the bottom of its trading range and 9-year rising support line (1) at (3).

Bottom line-One of the most important support tests in nearly a decade is in play at (3) for the DAX. If this support breaks it will have an important influence on other indices in Europe and potentially stocks in the states.




How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past