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.
High Risk Regime Persists, Near-Term Outlook Remains Adverse
The Dax advanced 0.8% on Monday, closing at 25,277.7, with 79.5% of constituents rising and 7.7% reaching new 52-week highs, while only 20.5% declined; advancing stocks also accounted for 78.5% of total volume, indicating strong internal participation.
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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 showed a modest improvement versus the previous observation, with the Trend Score advancing from 0.00 to 33.33. The Advance-/Decline 20 Days Momentum and WSC Short-Term Trend Index both turned bullish, signaling a positive shift in short-term price momentum and a broader participation of stocks trading above their 26-week highs. However, the Trend Trader Index Lines continue to show both envelope lines declining, indicating underlying structural weakness. The Modified MACD remains negative, reflecting ongoing short-term momentum deterioration, and the market closed below its 50-day moving average, with the EMA 50 Line also declining. The Trend Trader Index shifted to neutral, suggesting a pause in directional conviction.
TREND QUALITY improved notably, with the score rising from 16.67 to 50.00, moving from negative to neutral territory. This improvement was underpinned by a bullish turn in the Percentage of Stocks Above 20-Day MA, which now shows a majority of stocks trading above this key short-term average. The Modified McClellan Oscillator Daily also turned bullish, indicating that advancing stocks are outpacing decliners in momentum. New Highs vs. New Lows Daily remains supportive, with more stocks hitting new yearly highs than lows. However, caution persists as the Percentage of Stocks Above 50-Day MA remains negative, and both the Upside-/Downside Volume Index Daily and Modified McClellan Volume Oscillator Daily continue to reflect negative volume flows.
SENTIMENT remains unchanged at a neutral reading of 50.00. The Percentage of Stocks with RSI(14) below 30 continues to highlight an extremely oversold market, with more than 25% of constituents registering oversold conditions in the past three days, raising the likelihood of a short-lived bounce. However, Realized Volatility in % (10d) remains elevated above its 75th percentile, which is a negative signal for near-term risk appetite. Other sentiment gauges, such as the CBOE Total Put-/Call Ratio Daily, 9-to-1 Up-/Down Days, and Percentage of Stocks with RSI(14) above 70, remain neutral and did not materially influence the overall assessment.
Mid-term TREND indicators held steady, with the Trend Score unchanged at 25.00, maintaining a negative bias. The WSC Mid-Term Price Trend remains bullish, but this is offset by the WSC Trend Index, which continues to signal a bearish environment as the percentage of stocks trading above their 52-week highs remains subdued. The market closed below its 100-day moving average, and the EMA 100 Line is still declining, reinforcing the lack of sustained upward momentum in the mid-term structure.
TREND QUALITY in the mid-term remains weak, with the score unchanged at 20.00. The Percentage of Stocks Above 150-Day MA continues to provide a positive signal, indicating that a majority of stocks are still above this longer mid-term average. However, the Percentage of Stocks Above 100-Day MA remains negative, and both the Modified McClellan Oscillator Weekly and Advance-/Decline Index Weekly continue to show that declining stocks and momentum are outpacing advancers. The Upside-/Downside Volume Index Weekly also reflects weak demand, with volume favoring declining stocks.
SENTIMENT in the mid-term remains negative at 40.00, with little change from the previous observation. The WSC Capitulation Index continues to show positive momentum in smart money flows, and the AAII Bulls & Bears Survey turned bullish, indicating a structural bull-market signal from individual investors. However, Realized Volatility in % (20d) remains elevated, and the Smart Money Flow Index is not confirming current market levels. The WSC Capitulation Index FT continues to reflect a negative outlook from smart money. Other sentiment indicators, such as the Z-Score Put-/Call Ratio and Hindenburg Omen, remain neutral.
Dax trades within a Weak Structural Bull Market, as defined by Long-Term Market Health holding just below the 60 threshold. The current regime is High Risk and Risk-Off, reflecting a deterioration in Short-Term and Mid-Term Market Health while the longer-term backdrop remains constructive. This regime has persisted for over a month, with near-term conditions characterized by defensive positioning and limited upside participation.
Historically, since 1995, this regime has delivered an annualized return of -8.4% with a Sharpe ratio of -0.37, compared to a buy-and-hold baseline of +14.1% per year and a Sharpe of 0.66. Volatility is broadly similar to buy-and-hold at 23.1% versus 21.3%. The average maximum drawdown stands at -0.69%, and the up-day rate is 50.9%, based on a sample of 235 observations.
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.
High Risk| Market Regime | Zeitanteil | Episoden | Rendite p.a. | Positive Tage | Ø positiver Tag | Ø negativer Tag | Volatilität | Sharpe |
|---|---|---|---|---|---|---|---|---|
| Risk-On · 63.2% der Zeit | ||||||||
| Very High Reward | 52.0% | 351 | 44.6% | 57.9% | 0.7% | -0.6% | 14.4% | 3.10 |
| High Reward | 5.0% | 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 · 36.8% der Zeit | ||||||||
| Increasing Risk | 15.6% | 361 | -22.8% | 49.0% | 0.8% | -1.0% | 19.3% | -1.18 |
| High Risk | 7.3% | 235 | -8.4% | 50.8% | 1.0% | -1.1% | 23.1% | -0.37 |
| Very High Risk | 13.9% | 158 | -44.9% | 45.6% | 1.6% | -1.7% | 37.1% | -1.21 |
| Benchmark · Buy & Hold | ||||||||
| All Periods | 100.0% | n/a | 14.1% | 54.5% | 0.9% | -0.9% | 21.3% | 0.66 |
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 point to a muted near-term outlook. Historically, comparable phases have produced a roughly even split between positive and negative outcomes over the next week, with a slight negative tilt on the next trading day. One-month outcomes have shown some improvement, but the overall pattern remains mixed and lacks a clear directional bias in the immediate term.
The current combination of Short-Term and Mid-Term Market Health situates the regime as moderately stable, with a 59.5% probability of remaining in Risk-Off territory over the next five trading days (High Risk 52.4%, Very High Risk 4.8%, Increasing Risk 2.4%).
The historical pattern in this regime has favored reducing exposure or maintaining a defensive stance until clearer signs of improvement emerge. Positioning has generally leaned away from aggressive risk-taking, with a bias toward caution in similar episodes.
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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