Germany's DAX hits a new record high following a coalition deal in the country. Brenda Kelly, IG Group, says she expects a correction in the medium-term, seeing the DAX retrace towards 8,950-9,000.

SHOWS: LONDON, ENGLAND, UK (REUTERS - ACCESS ALL) (NOVEMBER 28, 2013)

1. IG GROUP TECHNICAL ANALYST, BRENDA KELLY, SAYING:

JOURNALIST ASKING BRENDA KELLY: ' Brenda, just looking at DAX, I mean it's gained more than 40% since Draghi's 'whatever it takes' comment. Time to take profits off the table?'

BRENDA KELLY: 'I think we could be looking for a correction in the near term. If you look at the DAX over the last eight weeks and we've seen eight consecutive weeks of gains. So if you look at it from a weekly perspective we're exceptionally oversold. The last time we saw the RSI at this level was back in February 2011 and that actually preempted a 15% correction to the downside. So from the daily perspective also looking at results likely overbought. So I do feel that while I do have a bullish target of around the 9,500 level, I do feel that we could make a retrace back down towards the 8,950 to 9,000 level in the medium term.'

JOURNALIST ASKING BRENDA KELLY: 'Is the DAX under pressure in any way from the relative strength of the Euro?'

BRENDA KELLY: 'I think that is the reason why we're seeing such DAX gains. There is a big demand in the retail sector at the moment for the Euro as we see capital flows come into Europe mainly because they believe that a lot of the US investors think that there is value to be got over here in Europe. So for the time being you have German confidence at a six-year high. You have a new coalition government. It does all seem to be going very well for the core of the Eurozone. But I would expect to see some profit-taking and I would expect to see the Euro see something of a decline as well against the US Dollar and despite the fact that we've seen certain ECB members threaten a negative interest rate for deposits. It does still continue to go towards the 1.36 level. But I think unless we get back through 1.3650, I would see some downside prevailing for the Euro against the Dollar.'

JOURNALIST: 'Now the FTSE's also seeing similar gains like the DAX, not as much though since Draghi's comments but similar in that case. Are we going to see more upside to come for UK stocks?'

BRENDA KELLY: 'I think the mining sector is the main problem for the FTSE for the moment. If you look at the FTSE350 mining sector over the same period from June, July 2012 to present, it's down some 15% in that same period whereas the FTSE up by 28%. So what I think we need to see happening here is a little bit lower production from the mining companies and maybe if gold falls below that $1,200 per ounce mark, that could incite them to do so. You also have the likes of Rio Tinto today upping their actual production levels in iron ore and that has seen them head to the top of the FTSE. So we could see some other mining companies follow suit there which could help to I suppose bridge the gap between the divergence of the mining sector and the FTSE itself. '