Europe is increasingly looking like it is heading into a recession. High energy prices, high costs, low water levels in the Rhine, and recent subdued business sentiment from Germany have all led to increased pessimism over Europe and a coming recession.

Is this negative sentiment going to start to weigh more heavily on stocks? If this sentiment looks to deteriorate further then look at the seasonal weakness that the Dax has at this time of year.

Over the last 25 years, the DAX has had an annualised return of -30.56%. Does this mean that the DAX is suitable for selling on this seasonally weak pattern?

Major trade risks: The major risks are from any relief in either energy prices and/or the end of the Russian/Ukraine crisis.


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High-Risk Investment Warning: Contracts for Difference (‘CFDs’) are complex financial products that are traded on margin. Trading CFDs carries a high degree of risk. It is possible to lose all your capital. These products may not be suitable for everyone and you should ensure that you understand the risks involved. Seek independent expert advice if necessary and speculate only with funds that you can afford to lose. Please think carefully whether such trading suits you, taking into consideration all the relevant circumstances as well as your personal resources. We do not recommend clients posting their entire account balance to meet margin requirements. Clients can minimise their level of exposure by requesting a change in leverage limit. For more information please refer to HYCM’s Risk Disclosure. *Any opinions made in this material are personal to the author and do not reflect the opinions of HYCM. This material is considered a marketing communication and should not be construed as containing investment advice or an investment recommendation, or an offer of or solicitation for any transactions in financial instruments. Past performance is not a guarantee of or prediction of future performance. HYCM does not take into account your personal investment objectives or financial situation. HYCM makes no representation and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast, or other information supplied by an employee of HYCM, a third party, or otherwise. Without the approval of HYCM, reproduction or redistribution of this information isn’t permitted.

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