DAX shows an incomplete Elliott Wave sequence from December 27, 2018 low favoring further upside. The rally from August 15, 2019 low (11266.48) is unfolding as an impulse Elliott Wave structure where wave 1 ended at 12814.49 and wave 2 pullback ended at 12607.06. Wave 3 remains in progress and the internal subdivides in 5 waves of lesser degree. Up from 12607.06, wave ((i)) ended at 12986.49 and wave ((ii)) pullback ended at 12795.09. The Index has resumed higher again in wave ((iii)) towards 13308.26 and wave ((iv)) pullback is proposed complete at 13137.88. Expect Index to extend higher 1 more time to end wave ((v)) of 3, then it should pullback in wave 4 to correct cycle from October 18 low before the rally resumes again in wave 5.
Near term, while dips stay above 12607.06, expect the Index to extend higher. We don’t like selling the Index and expect buyers to appear in any dip in the sequence of 3, 7, or 11 swing for more upside. Possible target higher is 100% Fibonacci extension from December 2018 low which comes at 13660 – 14221. The Index still needs to break above wave ((iii)) at 13308.26 to avoid a double correction. If the Index instead turns lower and breaks below 13137.88, then the Index is doing a double zigzag. In this case, it will still find support after it ends a 7 swing pullback