The German index bounced significantly during the open on Monday, and as I record this we are sitting just below the crucial €12,000 level. If we can break above there on a daily close, I think we could see buyers jumping into this market and trying to push the DAX towards the €12,400 level. The alternate scenario is that we roll over at the €12,000 level and test the previous uptrend line. If we break down below that uptrend line, the market could then go down to the €11,500 level, and then possibly the €11,000 level. I believe that the market should continue to see a lot of noise overall, as we are worried about trade wars between the United States and China, which of course will disrupt all global trade. However, it looks as if things are starting to calm down a bit, so I think that’s part of why the buyers have returned.
If we break down below the uptrend line, I think that the breakdown would be rather brutal, and we could see a lot of opportunity for short-term selling position. However, the way up would be quite a bit slower, as we have a lot to work through and a lot of noise to chew through to get towards the €12,750 level. That will take a lot more wherewithal to deal with, but the uptrend line of course does give you a little bit of confidence based upon how far back it goes.