DAX: Limited downside. Strong long term buy signal.

With the majority of global stock indices on a seasonal correction, DAX hasn't escaped the pattern and is down -4.85% from the 2019 highs. What stands out is that the downside on this correction is limited to -5.85% (avg) based on the last occurrence of the Golden Cross (MA50 over MA200) on a similar candlestick pattern.

In 2016 following the post Brexit rally the Golden Cross occurred which led to a -5.85% price decline and subsequent consolidation for 90 days. When completed, the MA200 acted as a support for the 2017 bull cycle. With the current candle action being identical we expect a similar price behavior. 11,700 will most likely hold a nearly two month consolidation before the price breaks aggressively towards the All Time Highs.








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