Divergence Taking Place Since May, Due To Germany

 

 

The broad markets (S&P 500 & NYSE) have been diverging against the Advance/Decline line since May. Why did this start in May?

Below looks at the NYSE A/D line, based upon Common stocks only. The line peaked in May and has been diverging since.

 

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Is the A/D line diverging for some reason? Below looks at what was one of the hottest performing stock markets in the world. From October of 2014 to April of 2015, the DAX index rallied nearly 50% in 7-months, out pacing the S&P 500 by a large percentage. I humbly feel its important to watch leading stock indices, because others can follow in both directions.

 

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As mentioned above, the DAX index hit triple resistance back in April (161% Fibonacci extension level and two resistance lines) at (1) above and this leading stock market has been soft since.

The DAX since April looks to be forming a small falling channel.

While many have discussed the impact of Greece and whether the Fed will raise interest rates, I feel what the DAX does going forward will have a large impact on the broad markets in the states.