The DAX has also turned down along with every other major index from around the world. From the early 2009 bottom, the DAX charged along just like all other indices, but with far more choppy wave structures than others. Grading the quality of waves tells me we are much closer to diagonal wave structures than pure impulse wave structures. Early 2018 was the real top for the DAX, which has never been breached and is holding at 13,500.
The stock mania around the world has ended, as the world dips into a demographic nightmare that investors have little knowledge about. As the DAX crashes along with the rest of the world, I’m sure the mainstream media will have to find reasons why the market is imploding, and the story above is just one. More and more of this demographic risk will start to show up as the media will run out of all other excuses why stocks are crashing.
In the long run, until 2022, we should be in a bear market that is just starting to get going. As long as analysts are saying to “buy on the dips” then these analysts have no clue to the size of this impending bear market!
There are 30-year cycles at work here and this 2018 peak is 89 years after the 1929 stock market peak. We would be off by 1 year in 90, which is just 3, 30-year cycles. I have done thousands of these 30-year cycle calculations between 100’s of different peaks, and yet a one-year error rate seems to stay true.
This is not going to be a simple crash like 1987 was, as this time there should be a huge long bearish move like the 1930-1932 decline gave us. 1987 was a Minor degree crash, and what we are dealing with here is at least 3 degrees higher.
Deflation is the real threat and the first clue that the Fed is going to switch is if they start to use “pause”, in their language!
Where the first major support price level comes is not an exact science but I look for major previous bottoms to give us a clue. Any big previous low can supply support, but support for what?