Germany’s DAX retreated below medium-term support at 9700, warning of a secondary correction. Follow-through below 9600 would confirm. Declining 21-day Twiggs Money Flow, below zero, indicates medium-term selling pressure. Breach of primary support at 8900/9000 is unlikely, but would warn of a primary down-trend. Recovery above 10000 is also unlikely at present, but would indicate an advance to 10500*. Respect of the long-term trendline at 9500 would indicate that momentum and the primary up-trend are intact.
* Target calculation: 9750 + ( 9750 – 9000 ) = 10500
Deutsche Post AG (y_DPW.DE) serves as a bellwether for European markets. Deutsche Post DHL couriers holds a similar position to that of Fedex in US markets. The stock formed a rounding top over the last year and is now testing primary support at 25.00. Breach of support would warn of a slow-down in economic activity.
The Footsie follows a similar path to the DAX in recent weeks. Reversal below 6700 would warn of a correction; follow-through below 6670 would confirm. Declining 21-day Twiggs Money Flow indicates selling pressure, but respect of the zero line would suggest long-term buying support. Recovery above 6800 is unlikely at present, but would suggest a rally to 6880. Breach of primary support is even less likely, but would signal reversal to a primary down-trend.
* Target calculation: 6800 + ( 6800 – 6400 ) = 7200