Post-Brexit: European Stock Market Is Not In A Bear Market

Share This Article
June 30, 2016 12:43pm NYSE:DIA NYSE:SPY

EuropeTaki Tsaklanos:  It seems that investors already forgot about the Brexit. On Monday, stock markets globally continued to slide, but that was followed by a huge rally on Tuesday and Wednesday.

We recommended, right after the Brexit news hit the wires, to stay calm and follow price movements.

This is what we wrote last Friday:

We have to say that the dust needs to settle first. Investors should not react too fast. It is tempting to do ‘something’ in this volatile environment, with non-stop news and crazy charts of futures markets. (read Post-Brexit what now: are investors supposed to panic or stay calm)

Moreover, when it comes to the stock market, we said there would be basically three potential scenarios unfolding: the start of a huge collapse, a mini flash crash, a short term retracement. This is what we wrote last Friday:

The German stock market index, DAX, tells us that 9000 points is the line in the sand. A structural close below 9000 points, defined as +5 consecutive closing prices, would be extremely concerning for stock bulls; that could indicate the start of a collapse.

So far, we have seen a sharp decline followed by a moderate recovery, which, so far, points to a flash crash scenario. (read Brexit: stock market collapse, flash crash or buying opportunity)

It now starts appearing that the stock markt went through a mini flash crash last Friday.

The DAX index is recovering, or, at least, is refusing to break down. That may sound counterintuitive, but the facts are clear: the DAX did not breach 8800 points.


Depending on how things unfold next week, we believe a buying opportunity is in the making, and “risk on” is returning the markets, no matter whether that is counterintuitive or not, it is what the charts are telling us.

This article is brought to you courtesy of Taki Tsaklanos.

7 Best ETFs for the NEXT Bull Market

Read Next

Free Investing Ideas Newsletter!

Join over 70,000 investors who get the latest insights and top rated picks from our free investment newsletter.

Most Popular

9 'MUST OWN' Growth Stocks for 2021

Explore More from

Free Investment Newsletter

Join over 70,000 investors who get the latest insights and top rated picks from our free investment newsletter. respects your privacy.

Best ETFs

We've rated and ranked nearly 2,000 ETFs and ETNs using our proprietary SMART Grade system.

View Top Rated ETFs

Best Categories

We've ranked dozens of ETF categories based on relative performance.

Best ETF Categories