Dax · DAX · Europe
The daily data-driven DAX analysis: where the DAX stands, how Trend, Breadth and Investor Sentiment define the current Market Regime, and how comparable setups have unfolded since 1995.
Short-Term Risk-Off Regime Persists, Stability Remains High
The Dax advanced 1.1% on Monday, closing at 25,575.0 after trading between 25,434.2 and 25,618.0. Market breadth was positive, with 69.2% of constituents rising and 61.9% of volume concentrated in advancing stocks, while only 2.6% of names registered new 52-week lows and none reached new highs.
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A compact analysis of the DAX indicators: Trend, Trend Quality (Breadth), and Sentiment across the short- and mid-term horizon, including Smart Money and Dumb Money positioning.
Short-term TREND indicators remain firmly negative, with the Trend Trader Index signaling a bearish structure as the market continues to trade below the lower envelope of its 20-day rolling low. Both envelope lines of the Trend Trader Index Lines are declining, underscoring the deterioration in short-term price structure. The Modified MACD confirms this weakness, as short-term trend momentum remains negative. The Advance-/Decline 20 Days Momentum also reflects a negative bias, with declining issues outpacing advancing ones. The WSC Short-Term Trend Index shows a low percentage of stocks trading above their 26-week highs, further highlighting the lack of short-term leadership. The market remains below its 50-day moving average, and while the EMA 50 Line is still rising, this is insufficient to offset the prevailing negative signals.
TREND QUALITY in the short-term remains deeply negative, unchanged from the previous observation. The majority of stocks are trading below both their 20-day and 50-day moving averages, as indicated by the Percentage of Stocks Above 20-Day MA and Percentage of Stocks Above 50-Day MA, respectively. This lack of broad participation confirms the fragility of the short-term trend. Volume-based indicators, such as the Upside-/Downside Volume Index Daily, continue to show negative flows, with declining volume outpacing advancing volume as highlighted by the Modified McClellan Volume Oscillator Daily. The Modified McClellan Oscillator Daily also points to persistent weakness, with declining stocks maintaining momentum over advancers. The New Highs vs. New Lows Daily metric remains negative, with more stocks hitting new yearly lows than highs, reinforcing the poor quality of the current short-term trend.
Short-term SENTIMENT remains negative, with several contrarian and risk indicators deteriorating further versus the previous session. The CBOE Total Put-/Call Ratio Daily has turned bearish, signaling increased greed among market participants, which is typically a negative contrarian signal. Realized Volatility in % (10d) has also turned bearish, now trading above its 75th percentile, indicating heightened risk aversion and instability. The presence of a recent 9-to-1 Down Day within the last five sessions points to heavy institutional selling pressure. Meanwhile, the Percentage of Stocks with RSI(14) above 70 and below 30 remain neutral, suggesting that the market is neither extremely overbought nor oversold on a short-term basis. Overall, the sentiment backdrop continues to weigh on the short-term outlook.
Mid-term TREND indicators have improved notably, with the WSC Mid-Term Price Trend confirming a bullish structure. The market has closed above its 100-day moving average, and the EMA 100 Line continues to rise, both of which are constructive developments. The Percentage of Stocks Above 100-Day MA and 150-Day MA both indicate that a majority of constituents are trading above these key levels, supporting the positive trend. The Advance-/Decline Index Weekly has turned bullish versus the previous session, with advancing issues outpacing decliners, and the Upside-/Downside Volume Index Weekly shows healthy demand as advancing volume outpaces declining volume. However, the WSC Trend Index remains a point of caution, as the percentage of stocks trading above their 52-week highs is still subdued, suggesting that while the trend is positive, leadership is not yet broad-based.
TREND QUALITY in the mid-term remains at a maximum reading, unchanged from the previous observation. The Modified McClellan Oscillator Weekly continues to show that advancing stocks are outpacing decliners, confirming robust momentum. The WSC Capitulation Index and WSC Capitulation Index FT both turned bullish, indicating that smart money flows are now supportive of the market. The breadth of participation is further confirmed by the strong readings in the Percentage of Stocks Above 100-Day and 150-Day MAs. These factors collectively point to a high-quality mid-term trend, with improving breadth and momentum underpinning the positive technical structure.
Mid-term SENTIMENT has improved to neutral, advancing from a previously negative stance. The AAII Bulls & Bears Survey continues to reflect elevated fear among individual investors, which can be interpreted as a contrarian positive. However, the Z-Score Put-/Call Ratio remains neutral, and the Smart Money Flow Index has not provided a clear directional signal. Realized Volatility in % (20d) has turned bearish, now trading above its 75th percentile, which introduces a note of caution regarding risk conditions. The Hindenburg Omen remains neutral, suggesting that while market breadth is not signaling imminent risk, it is not yet fully supportive. Overall, sentiment is mixed but has improved from the previous observation, with some risk factors offset by contrarian positives.
Dax trades within a Structural Bull Market as defined by Long-Term Market Health, with the current regime classified as Increasing Risk. This regime reflects a pronounced divergence between weak Short-Term Market Health and robust Mid-Term and Long-Term Market Health. The near-term deterioration is concentrated in the short-term picture, while the broader structural backdrop remains supportive.
Historically, since 1995 and across 360 samples, this regime has delivered an annualized return of -22.7% with a Sharpe of -1.17, against a buy-and-hold baseline of +14.4% per year. Volatility is broadly similar to buy-and-hold at 19.4% versus 21.3%. Average maximum drawdown is -0.93%, and the up-day rate is 49.0%.
Historische Rendite des DAX je Marktphase: die Entwicklung der sechs Market Regimes seit 1995 im Vergleich zur Buy-and-Hold-Benchmark. Die aktuelle Marktphase ist als Aktiv gekennzeichnet.
Increasing Risk| Market Regime | Zeitanteil | Episoden | Rendite p.a. | Positive Tage | Ø positiver Tag | Ø negativer Tag | Volatilität | Sharpe |
|---|---|---|---|---|---|---|---|---|
| Risk-On · 63.4% der Zeit | ||||||||
| Very High Reward | 52.1% | 351 | 44.6% | 57.9% | 0.7% | -0.6% | 14.4% | 3.10 |
| High Reward | 5.1% | 139 | 44.3% | 56.8% | 0.9% | -0.8% | 18.2% | 2.43 |
| Increasing Reward | 6.2% | 96 | 67.6% | 57.1% | 1.3% | -1.2% | 27.0% | 2.50 |
| Risk-Off · 36.6% der Zeit | ||||||||
| Increasing Risk | 15.4% | 360 | -22.7% | 49.0% | 0.9% | -1.0% | 19.4% | -1.17 |
| High Risk | 7.3% | 233 | -7.8% | 51.0% | 1.0% | -1.1% | 23.1% | -0.34 |
| Very High Risk | 13.9% | 156 | -44.8% | 45.6% | 1.6% | -1.7% | 37.1% | -1.21 |
| Benchmark · Buy & Hold | ||||||||
| All Periods | 100.0% | n/a | 14.4% | 54.5% | 0.9% | -0.9% | 21.3% | 0.67 |
Returns annualized; up-day share, average daily returns, volatility and Sharpe Ratio based on historical daily data since 1995. Past performance is no guide to future results.
Short-Term and Mid-Term Market Health scores indicate a mixed short-term outlook. Historically, similar phases have produced a balance of positive and negative outcomes, with no clear directional edge over the next several weeks. The near-term environment has not favored persistent upside, and the risk of further drawdown remains elevated in the immediate horizon.
The current combination of Short-Term and Mid-Term Market Health situates the regime as extremely stable, with a 100.0% probability of remaining in Risk-Off territory over the next five trading days (Increasing Risk 96.7%, High Risk 3.3%).
The historical pattern in this regime has favored reducing exposure or adopting a defensive stance until short-term conditions improve. The bias has leaned toward caution rather than ongoing participation.
WallStreetCourier publishes end-of-day research on the DAX every trading day. With a free Basic account you get full access to one market every week: Daily Morning Briefing, Market Regime Research, Market Health and the complete Indicator Dashboard.
See This Week's Free Market →The current classification is shown at the top of this page and is updated after the close on every trading day. It is based on the DAX Market Regime, the market phase derived from trend, market breadth and investor sentiment. Instead of price targets, the analysis shows how the DAX has performed in comparable conditions since 1995. The freely available report is published with a delay; members receive it on the day of publication.
The answer is provided by the six-level scale at the top of this page. The upper three levels (Risk-On) indicate a constructive, broadly bullish environment, the lower three (Risk-Off) a defensive, broadly bearish environment. In addition, the long-term Market Health Score, a measure of market health from 0 to 100, shows whether the DAX is trading in a bull or bear market on a structural level: readings of 50 and above indicate a bull market, readings below 50 a bear market.
Nobody can predict that with certainty. Instead, Chapter 04 shows the probability that the current market phase of the DAX has persisted or shifted in comparable historical conditions since 1995. This provides a statistical expectation for the coming trading days, not price targets.
The long-term outlook is derived from the structural market status and historical statistics: Chapter 04 shows how often the DAX was trading higher twelve months after comparable market phases and what the average development looked like. This is a probability-based assessment built on data since 1995, not a prediction.
Indications are provided by the sentiment indicators in Chapter 02, including the positioning of Smart Money and Dumb Money, meaning institutional and retail investors. Extreme euphoria has historically served as a warning signal, while extreme fear often acts as a contrarian indicator. The current state of investor sentiment is published on every trading day.
No. Classic forecasts provide price targets and chart levels. Instead, this page determines the current market phase of the DAX on every trading day based on trend, market breadth and investor sentiment, and shows how comparable phases have developed since 1995. Probabilities instead of price targets: that is the data-driven form of an outlook.
A Market Regime describes where a market stands as of the latest close on a six-level scale, from Very High Reward to Very High Risk. The upper three levels are considered Risk-On, the lower three Risk-Off. The classification describes the risk-reward environment the DAX is trading in, not a price target.
Market Health is a measure of the market's condition: a composite score from 0 to 100, calculated separately for the short-, medium- and long-term horizon. It combines three dimensions: Trend shows whether the market is moving up, down or sideways. Market breadth (Trend Quality) measures how many stocks are actually participating in the move. Sentiment captures investor mood, including the positioning of Smart Money and Dumb Money. Readings above 50 indicate a constructive environment.
Risk-On comprises the three constructive Market Regimes Very High Reward, High Reward and Increasing Reward. Risk-Off comprises Increasing Risk, High Risk and Very High Risk. This distinction matters because the six Market Regimes have developed very differently over three decades. The table above shows, for each Market Regime since 1995, the annualized return, the share of positive days, the volatility and the Sharpe Ratio compared to the buy-and-hold benchmark.
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No. WallStreetCourier publishes quantitative market research for informational purposes. It describes current market conditions but does not provide recommendations to act. The historical performance of a Market Regime is not a reliable indicator of future results.
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