I think it's important to observe DAX performance in the real (dollar) terms. That basically means we have to look GER30*EURUSD. It made it's top long before compared to nominal terms (GER30) @ 12386 in 2015-04-06. Since that day it has been trending lower, but are things starting to change?
The ratio tells you that has the price appreciation been faster than Eur/Usd exchange rate declining - i.e. are the things getting better fundamentally or has the recent appreciation been only currency inflation?
Based on the fibonacci's and recent price action, it has not been only currency inflation. GER30*EURUSD made a bottom in the beginning of 2016 FY and an impressive double bottom in the summer. Since then GER30 has been appreciating faster than Eur/Usd declining. If the both would start appreciating, that would imply that things are really starting to improve fundamentally in the European Union. That would mean GER30*EURUSD to break above the channel.
Now it seems to be in "consolidation-mode", but coming months will show hopefully medium-term direction.
The ratio tells you that has the price appreciation been faster than Eur/Usd exchange rate declining - i.e. are the things getting better fundamentally or has the recent appreciation been only currency inflation?
Based on the fibonacci's and recent price action, it has not been only currency inflation. GER30*EURUSD made a bottom in the beginning of 2016 FY and an impressive double bottom in the summer. Since then GER30 has been appreciating faster than Eur/Usd declining. If the both would start appreciating, that would imply that things are really starting to improve fundamentally in the European Union. That would mean GER30*EURUSD to break above the channel.
Now it seems to be in "consolidation-mode", but coming months will show hopefully medium-term direction.
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SNAPSHOT OF WEEKLY CHART
