As one of Germany's biggest banks, Deutsche Bank (DB) has taken a lot of heat for its levered-up exposure to EU sovereign debt. Now, investor anxiety could be ramping up enough to spur even more selling in this financial firm. For traders, the short signal comes from a solid technical setup in shares.
Right now, Deutsche bank is forming a head and shoulders top, arguably one of the most well known technical patterns out there. The head and shoulders is formed by two intermediate peaks that take place around the same price level, separated by a higher peak in between. The pattern signals exhaustion among buyers -- and flags traders with a sell signal on a breakdown below the neckline that sits below all three peaks. In DB's case, the neckline comes in at $42.50.
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