The CAC40 Tests Trendline Resistance at 4,650
- CAC40 trades marginally higher this morning
- Trendline resistance is found at 4,650
- A trend resumption exposes lows at 4,805
(Created using TradingView Charts)
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The CAC40 Index is trading slightly higher on the day, up .85%. However, prices still remain capped underneath a developing bearish trendline. The trendline depicted above, has been drawn on a Heinkin Ashi chart, by connecting a series of wicks which represent lower highs for the CAC40. Traders looking to sell the Index in its current downtrend may continue to monitor the Heiking Ashi chart for a fresh bearish candle. In the event that a new red filled candle without an uppper wick develops, it would be taken as a strong signal for the resumption of the trend. In this scenario, traders may begin looking for prices to challenge the current monthly low at 4571.
Traders looking for a bullish reversal for the CAC40, will want to see a breakout above the mentioned line of resistance which now resides near 4,650. A move of this nature should be coupled with a series of bullish blue filled candles. Typically, in a bullish reversal, Heikin Ashi candles should have no lower wicks to indicate the strength of the markets new trend. Initial projections for a bullish reversal include a move back towards the previous swing high, which resides at a price of 4,805.
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