There is a little something that is going on concerning DAX. On the one hand by end 2013, US investors had 32% of shares listed in DAX's index. Apparently by now that level is at around 30-31%. The biggest investor is being Blackrock Fund Advisors with almost 20 billions USD invested.
Therefore all the question is how US investor will behave with the tappering?
One thing is preatty clear, cheap euro against USD and cheap money with negative interest rate and TLTRO is not enough.
If US investors are going to take some profit from there investment since September 2012, which would be normal, DAX may break the channel for a correction towards 8100 and even 7501. 7501 is just a 50% retracement which is still above the level of what DAX used to be at the eve of QE3 in September 2012.
Since 10050, I am still thinking that with the end of the US stimulus package, DAX may face a correction towards 8100 as you would see in my past studies. This would be healthy for the long term investment of the DAX index and also for investor that may cash a little bit of profit before going long again on the index. But let's wait and see.
Therefore all the question is how US investor will behave with the tappering?
One thing is preatty clear, cheap euro against USD and cheap money with negative interest rate and TLTRO is not enough.
If US investors are going to take some profit from there investment since September 2012, which would be normal, DAX may break the channel for a correction towards 8100 and even 7501. 7501 is just a 50% retracement which is still above the level of what DAX used to be at the eve of QE3 in September 2012.
Since 10050, I am still thinking that with the end of the US stimulus package, DAX may face a correction towards 8100 as you would see in my past studies. This would be healthy for the long term investment of the DAX index and also for investor that may cash a little bit of profit before going long again on the index. But let's wait and see.
