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CAC 40 Fails at Critical Resistance

CAC 40 Fails at Critical Resistance

Walker England, Forex Trading Instructor


Talking Points

The CAC 40 has closed the week moderately higher, after being rejected yesterday from its 200 Day SMA (Simple Moving Average) at 4,454.00. Of the 40 listed stocks Karing shares have had the biggest gain on the session, closing up 6.19%. Going into next week’s trading, traders may again look for the Index to challenge resistance at the 200 period SMA. However if price fails to break out above 4,454.00, it opens up the Index to decline back towards the July 2016 swing low at 4,060.00.

CAC 40, Daily Chart

Short term technical levels for the CAC 40 include over the R4 Camarilla pivot, at 4,482.13. A move above this value would be significant as price would have broken above the previously mentioned SMA. Support for the CAC 40 has also been established at 4,416.00. This arear is represented by the S4 pivot, and in the event that price breaks below this value next week it suggests that the Index is prepared to test new lower lows.

CAC 40, 30 Minute Chart

Find out real time sentiment data with the DailyFX’s sentiment page.

Traders tracking sentiment should note that SSI for the CAC 40 (Ticker: FRA40) reads at -1.47. With 59% of positioning short, sentiment suggests that the CAC 40 may attempt to trade higher next week. In the event that prices breakout higher, SSI figures should continue to read negative and move to an extreme figure of -2.0 or greater. Alternatively, in the event of a bearish reversal traders should look for SSI to move towards a positive reading.

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.