CAC40 Trades Up 3% on Breakout
CAC40 30 Minute Chart
(Created using Marketscope 2.0 Charts)
Losing Money Trading? This Might Be Why.
The CAC40 is currently trading up over 3% on the day after breaking a critical point of resistance on the daily chart. As seen in the graph above, the Index has broken out above Thursdays high at 4,022. Today’s move is significant as it concludes the inside bar pattern which developed when prices failed to breakout before Fridays close. As old resistance becomes new support, traders may continue to look for opportunities to join this emerging bull trend above 4,022. It should be mentioned that previously mentioned bullish targets for the CAC40 include 4,145 which represents a 1X price extension of Thursday’s daily candle.
In the event that prices fall back below 4,022 the change in market conditions would invalidate today’s bullish breakout. In this scenario, traders may look for prices to return back in the direction of the CAC40’s primary trend. This includes prices potentially challenging the current 2016 low which resides at 3.890.
SSI (Speculative Sentiment Index) for the CAC40 (Ticker FRA40) is currently reading at an extreme +3.50. When taken as a contrarian signal an extreme positive number in positioning suggests that there may be future declines in store for the Index.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.