German DAX Risks to the Downside
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German DAX– Retail CFD traders are net-long the GER30 contract, which tracks the German DAX equity index, and a contrarian view of crowd sentiment gives us a modestly bearish trading bias. An important caveat is that crowds have recently sold into the past week of DAX gains; total short interest is up 13 percent while long positions have fallen 22 percent.
We maintain a bearish trading bias for the German DAX, but a sustained shift towards retail selling would give reason to take the opposite stance and buy into gains.
See next currency section: S&P - S&P 500 Likely to Hit Further Highs
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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