Dax Update : 11400 Support and stocks to be considered if market bounces.

 

December 7th and  December 12th posts quoted  (Red arrow 1) :  » Upside is open as said before with first targets at 11400 & 11800 with maximum retracements allowed to 10800-10900. »

The last 2 weeks of 2016 saw  first target of 11400 reached (Red arrow 2) and 11800 target in the last week of January (Red arrow 3). After a 17% up move since november , Dax is in a normal consolidation process and prices should be supported at previous 11400 resistance area . The ascending 50 days moving average blue line should help to support prices around the same zone.

Beware a daily close below 11400 as this could bring Dax down where the current move started back in December i.e. 10800 . A weekly close below 11400 would put more weight on the bearish side.

 

 

Should 11400 support holds and markets reverses (Watch MACD daily for confirmation) , the stocks having the best chances to outperform would be the « Trump beaten stocks  » (mainly the german car makers – amongst the worst performers YTD), the High BETA , the HIGH dividend and  the low PE stocks .

The 2 stocks complying with the 4 criteria are BMW and Daimler . I like the cyclical Thyssen Krupp that will likely overperforms if market picks up and EON ( High Div) in catch up mode since a few weeks after several years of misfortune.

 

Dax High Dividend Stocks

 

Dax High Beta Stocks

 

Dax Low PE Stocks