CAC40 and other European markets: Excellent short opportunity!Top of the channel reached, bad fundamental data everywhere, US markets overshooting because of Trump, Bearish Gartley Pattern + Head and Shoulders pattern on the DAX (see my previous post), and so on.
It's bearish, with a very high probability.
Indices Europe
Please Mind the CACOn the 24th April the CAC 40 made a huge gap up, from 5050 to 5260. An incredible 4%. In fact it is the largest gap we can see historically as far back as 2008.
Gaps, as trades know, 'always' get filled. Statistically its more like 90% of the time.
Whether bullish or bearish on the European reflation story, this trade is the same.. French stocks are likely to pull back to close this gap, before either continuing on their rally, or otherwise.
Trade execution:
A conservative way to play this would be see the actual gap as being highest high previously, which is actually 5140 (blue line). A more aggressive short target would be the 5050 from where it jumped.
Just an idea -- actually a small gamble -- Le Pen wins.I am going to bet that Le Pen wins the election. I believe that the Macron victory is already in the price, after first round of elections. Now he is approx. 20% lead vs Le Pen. So if Le Pen wins there would be a much bigger surprise. I will open a small position.
The risk ratio is between 2-3, so this is comparable to every trade I make.
DAX "GER30" SHORTLongterm Short after opening gap for DAX "Ger30" same scenario with CAC "CAC40"
Remember to follow French Presidential Elections
Events at North Korea
etc..
Take Profit at Previous Swing LOWs appx 9400s
SL- With relatively safe trades .... who needs SL when at worst scenario you can hedge :p
CAC40 - Has the rally just begun?The resistance offered by the falling trend line drawn from Sept 2000 high and June 2007 high was breached last month.
This month's candle shows a sharp rebound from the sub-trend line support level followed by a rise to 5295.5 (highest level since Jan 2008 high).
The chart also shows a nice rebound from the rising trend line in mid 2016.
Overall, the technical picture says the rally may have just begun... the monthly RSI is rising and is yet to overbought territory.
Testing weekly harmonic pattern - Is it heading to 6000? Even before yesterday's results, the French CAC40 provided a bullish long term signal when it broke above a monthly downtrend line.
The CAC40 is testing the X point of a bearish Bat pattern (similar to what we see in German DAX) and if it'll break and close above it, it can continue all the way up to 6000 to test a bigger PRZ.
This is what you need to know before the elections results EURUSD is trading inside a yearly trading range.
There's a daily uptrend line that EURUSD is currently still above.. and from above it has a daily downtrend line and the middle of the range - 1.1 (Resistance Zone).
In case of a bullish move, focus on 1.1.
A breakout above this price zone could send EURUSD towards 1.14-1.115 again to re-test the top of the range
In case of a bearish move, a breakdown of the 1.04 support zone can lead EURUSD towards parity and even lower.
As long as it stays inside the range, you can try and trade the range
Just an observation regarding markets. A Return to fundamentals.Ideas:
-Buying high to sell higher may work, but chances for corrections in the next years are likely.
-Selling or shorting may be unadvisable. Despite the chance of corrections, shorting behavior is similar to bubble behavior. As always, there is a likely chance there are shorters who will have losses.
-Selling actual stock positions that have been bought lower, here, is generally a good idea. Not having exposure, or having small exposure, at this moment in time, is likely good.
Despite the chart idea to buy above 2700 and sell at 2900, with a stop loss at 2650, there is a chance of a correction as soon as it reaches 2730-2740 levels.
A move towards 2400 for DOWG is likely this year and possible in the next years.
The 'where and when' spots to short are generally harder to guess.
If it closes at year end below 2450, the next years are likely to be negative.
Any down move below 2350 can send DOWG to 2250 and 2200 respectively.
Corrections touching 2000 and below in the next 5-10 years can happen, though unlikely.
What the white background says:
---To quote:
Lows and restructuring in the year 2018 and the next couple of years.
Two potential years with negative corrections on the market.
A correction in 2017 is possible, more frequent corrections are likely to happen in the years ahead.
Corrections will continue to happen until there is a just system in place.
The alternative is delays and further bubbles.
Changes from within big companies are highly improbable, only companies with hedging and wisdom will stay.
Companies that built themselves on bubbles will very likely pop themselves, just as they bubbled themselves.
---End quote.
Between Currencies versus Commodities, there may be a temporary safe haven in Commodities.
Lack of liquidity, medium of exchange, bartering can be troublesome obstacles in commodity area, if some currencies fail, due to some government defaults(if they happen).
People that actively participate in 'governments' will be actively influenced by 'government dogma', that is, 'intentional ignorance of fundamental facts'. Ideologies not backed by good fundamentals ultimately fail(when even belief is strong), because lack of fundamentals to sustain 'believers' that have forgot fundamental logic on how one lives and thus, simply, experience forced awareness to fundamental facts. Fundamental facts are that living is done by practicing agriculture(sometimes systems that are immune to harsh environments, see aquaponics), and not using derivative means to live(getting a job in companies built on bubbles) and by practicing wisdom, through studying, (and not sins that pushes one away from fundamental facts), and then after that, practicing what one has learned, but under God's Law(Noahide Laws).
en.wikipedia.org
DAX and other European indices (Points and Figures): Fake out?So "they" want everyone to turn bullish (whether artificially or not) or be stopped out. The weak buyers are being washed away, shorts must be covered or the shorters will burn their feet if that's not already the case. Retail investors are still very bearish overall, but what is observed in Europe and in the official financial news show that money is flocking to European equities, among other things (even real estate is "booming" again). Indices are compelled to go higher, but the exhaustion seems to be nearing. Summer could be very frustrating. Volume seems to be impressive, but for such small moves (green XXX) at the time I am writing this post, this appears to be not. Volume is accumulating, we see final explosive moves, this could signal the beginning of the end of a bull market. But it will still grind up. It's better to buy pullbacks with tight stop loss orders, or wait until it goes way up if people want to short. However, we don't know yet when this will truly end. I would expect spikes and fake out. Reversal days could be extremely tricky.
CAC 40 - Pivotal pointBy closing at 5069.04, the CAC reached its long term down trend and is now at a pivotal point.
Using weekly prices, the recent uptrend looks still solid with no sign of regression with any relevant indicators.
However, using daily prices, 2 keys indicators, momentum and RSI show a regression synonym of short term weakness which could prevent the index to go through and keep it in the current long term downtrend initiated in Sept 2000 and June 2007.
In case of breakout, the CAC the first resistance stands at 5283.
On the other hand, a return back to 4929 then 4733 will be on the cards. Anything below the latter would annihilate the current uptrend
What is happening with the stockmarkets right now?If we look at the indexchart of the AEX (dutch25) we are seeing high consolidation. This means that markets are on this moment unpredictable and are waiting for more information.
Why can't we predict the markets?
Because we saw at the past that markets dind't react as expected on politics and economic data. This means that the most people are afraid to place orders. Wich can turn on a consolidated market.
What to do?
Because i only go long i'm waiting for a drop or breakout in the market. If this happen, i will go long.
CAC 40 consolidates following December breakFollowing the impulsion at the beginning of december, the index is now consolidating its recent uptrend.
Since beginning of December, after exiting a 4 month old canal, the impulsion led the index to multiple new highs.
However, if the price kept going higher, the current uptrend is weakened by a divergence since mid december and visible on three main indicators (RSI, Momentum and MACD). It is very much a short term worry though as this doesn't appear on the weekly data of the index.
- On a short term point of view, holders can keep their long position although others would wait for a more affordable price.
- Mid to long term investors would use the same pivot prices to enter the market or not. For those already long, there is no clear indication to close a long position now and even less to open a short one.
- The divergence would be totalled by a break above the recent high at 4929.6. That would be a significant buy signal.
- On the contrary, a break below the support at 4822.29 would generate a short term sell signal.