Looking at the Dax today and keeping in mind the old saying "sell in May and go away; don't come back till St Leger Day", we must warn that many European indices look terribly similar. Having soared to a record high in April on massively bullish fund manager sentiment and becoming more overbought than at any point since 2007, the index swooned and gave back nearly all of last month's gains with a monthly evening star candle (others a stronger shooting star). We believe an interim top is in place and expect indices to retrace more of this year's gains, down to at least the Fibonacci 61.8 per cent level and maybe 9,900 points, where we kicked off in January.
