Market sentiment: “Noticeable relief”

January 28, 2026. FRANKFURT (Goldberg & Goldberg). It feels like the World Economic Forum in Davos was a long time ago. But it was only a week ago that US President Donald Trump arrived there and gave a 70-minute speech to a packed hall. Afterwards, all the threats that had been made in the run-up to the event seemed to have been swept away. He changed his mind about Greenland and withdrew his threat of punitive tariffs against some European countries. So Trump has backtracked, at least for now. Since our last sentiment survey, the DAX has also recovered from its initial slight setback of 1.1 percent, although it has not been able to make up for the losses suffered two weeks earlier: it closed just above the 25,000 DAX mark. Nevertheless, we have recorded a gain of 0.8 percent since last Wednesday.

Incidentally, during the same period, the US dollar exchange rate against the euro weakened significantly, at times by more than 3 percent, with the single currency even reaching a level last seen more than four and a half years ago.

Exodus of bears

Meanwhile, sentiment among the institutional investors with a medium-term trading horizon that we surveyed has continued to improve. Our Deutsche Börse Sentiment Index rose by 14 points to a new level of +12. This is primarily because the bear camp has shrunk for the second time in a row – this time by 14 percentage points. It is striking that almost all former bears have now joined the ranks of neutral investors. In contrast to the previous week, when we saw growth in the bull camp, almost no one dared to take on new long positions.

We are seeing a similar trend among private investors. Here, the Deutsche Börse Sentiment Index rose by 7 points to a new level of +11. If we exclude the investors we survey via social media from this analysis, the trend in this panel is almost identical to that of institutional investors: Many former pessimists have closed out their positions and joined the neutral players. However, optimism in this subgroup lags somewhat behind, with the sentiment index there only at +5. The mood has also improved somewhat among the private investors we survey via social media.

But only cautious domestic optimism

Today's survey shows that sentiment among private and institutional investors is almost at the same level. Among the latter, sentiment has even improved by 30 points compared to two weeks ago. In other words, bearish positions have been significantly reduced in many places, while the DAX has fallen at the same time. Even though a sentiment level of +12 does not look particularly optimistic and is practically neutral in relative terms since the beginning of the year, the latest development nevertheless indicates a certain amount of pressure on the upside. At the very least, we expect to see supply from profit-taking in the range between 25,350 and 25,400 DAX points, and possibly also repositioning by previously neutral investors.

The downside, on the other hand, looks somewhat softer, but is not unprotected. This is especially true given that pessimists still account for 28 percent of all respondents and neutral investors, with a 32 percent share, still have a say as potential buyers. It is also possible that renewed demand from international investors will provide additional support for the DAX – the aforementioned weak dollar could even be an indication that long-term capital flows are still flowing into the eurozone. Conclusion: We see a solid basis for the near future. 

by Joachim Goldberg

January 28, 2026, © Goldberg & Goldberg for Deutsche Börse

The Deutsche Börse Sentiment Index ranges between -100 (total pessimism) and +100 (total optimism), with the transition from positive to negative values marking the neutral line.

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