DAX INDEX

Though it hasn’t been a great year for equities and especially for European equities can 2012 start with a positive performance for Europe? In the past two months DAX formed a consolidation range (symmetrical triangle) below its 200-day moving average. We are likely to see  a breakout from the short/intermediate term consolidation range in the beginning of 2012. A breakout on the upside should be positive for DAX and would possibly challenge the 200 day moving average at 6,220 levels. Upper boundary of the consolidation range is at 6,000 and the lower boundary is at 5,750. Breakout in both direction should result in multi-month trend period for the index.