German stocks are taking a beating! The leading European stock market index was trading around 16 500 in July and in the first week of October it dipped below 15 000. Fears of recession cause an extend sell off and the DAX collapsed with more than 1500 points. The asset is trending south and this trend is confirmed by the alligator indicator. All 3 moving averages point down.

An important fact to mention is the value of the %R indicator. It is now below -35, which is a signal for an oversold market. Oversold market means the prices became too cheap. In addition to that, the index is forming a local zone of support for the past 5 days. Likely due to the oversold signal of the %R, buyers step in to buy from the bottom and the prices hold above 15 090. We anticipate a certain price move and to see what is our preferred direction please visit our Go premium section.