From Taki Tsaklanos: Global stock market investors are very cautious in March 2017 about their stock market investments. Why? Because leading indexes have arrived at critical price levels.
As said in the past, it is only a minority of 10 to 20 percent of prices on a chart that do matter. The vast majority of price points has no meaning to investors, certainly not important in decision making. March 2017 is a very important month because leading stock markets arrive in a price range that we categorize as top 1 percent importance on the long term charts.
Very recently, InvestingHaven published this article in which its research team argues that the DAX as a leading stock market is near a hugely important price level. That comes on top of the observation that 5 leading markets are at major inflection points (including dollar, gold, crude oil, copper).
Meantime, the DAX, a bellwether of global stock markets, has continued its rise. It is now inches away from all-time highs. This is major news of course. The fact that mainstream financial media is not talking about this underlines the high level of importance.
At this point, the DAX stock market index can do two things. Either it breaks out, which would be a hugely bullish signal for global stock markets. The bearish side of things is that it puts a double top, and stocks go (significantly) lower from here.
The key price level to watch is 12,250 points. How the DAX ‘behaves’ around that price level is of the highest importance to global stock market investors and stock market indexes.
An even more important reason why March 2017 is an unusually important month for global stock market investors is the pattern on both the NASDAQ and RUSSELL2000 indexes. Both indexes are leading U.S. stocks, but mostly also set the tone for most other stock indexes worldwide.
The following chart makes our point (chart courtesy KimbleChartingSolutions). Watch how a secular trendline which connects major tops over the last 2 decades is tested right here right now. This is major news, as it is an extremely important price point from a price analysis perspective.
The PowerShares QQQ ETF (NASDAQ:QQQ) fell $0.2 (-0.15%) in premarket trading Monday. Year-to-date, the largest ETF tied to Nasdaq-listed stocks has gained 10.58%, versus a 6.66% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Investing Haven.