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Lucas: How unusual signs help me trade the DAX

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There is a lot of volatility in the stocks markets and especially in the German DAX as the Volkswagen scandal unfolds. So how can you tell where it will go next? Well, there is one sign to watch out for and it is quite unusual, says Steve Lucas from 3c Analysis.

When analysing the stock markets, Lucas looks at all the usual signals associated with technical analysis as well as market sentiment, different sectors and commodities to indicate economic sentiment and statistics. But to get confirmation of the direction a market like the DAX may take, Lucas uses the FTSE-DAX spread.

Lucas explains how he used spreads to confirm a trade published on Tradingfloor today: ‘DAX shows signs of momentum after bearish week’. He also shares where he thinks the DAX and US stocks may be heading next.