Once Resistance Hit, Potential Pullback SufferedPrice action just cant quite get back into that really beautiful channel the CAC40 was running in the past three months. I expect once price action hits resistance that we'll see a bit of a pullback.
France
CAC40 Rejoins Channel, Technicals Flash OverboughtWhile the CAC40 gave traders an almost perfect technical upward channel for January February and most of March, that channel was broken last week only to be somewhat regained over the past few sessions. It still does not know however if that channel support line is now resistance or still support. Moving averages all signal upward momentum while bull bear sentiment and RSI flash that this index is overbought. I'm not confident in equities right now. They all seem overbought and tend to be universally stagnant. Let's see how much further we can go though.
Former Support Channel as Resistance?This is such an interesting technical channel that we saw stemming back from December 2018. While, it failed to continue and broke through, it seems like now price action wants to use that former lower section of the channel that was support as resistance. However, this one is not as perfect as the channel that had formed as price action is creeping back into the channel. Either way, this one is still a fun one to watch considering how technically perfect it was acting for quite a while.
Textbook Channel ContinuesExpect a bit of a pullback at first as RSI and Stochastic are indicating overbought. However, overall macro trends are solid, global growth may be picking up, and in sum you'll probably make some money on this.
Channel broken a bit early, but could indicate bear marketMy call on CAC40 is changed from long to neutral now that global markets are increasing their fear on a global slowdown. This is evident in markets around the world as Asian markets plunged today as did European. US is set to be down as well. Overall, the channel break is incredibly disheartening for those expecting higher gains as it was a huge move down (3 percent). If you were not in this trade closer to the bottom, you may have missed your chance. If you didn't sell before this dip then you may have made some money. For those shorter-term traders, you may have already missed the train. We could get back in this channel tomorrow, but that seems unlikely. I'm actually more neutral to short than neutral, but Trading View only gives us three options so I prefer not a drastic shift from long to short. Let's see what happens over the next few days.
A different outlook for French Equities....2019 prediction=> Here we have a different view for French Equities as those who are following our telegram will already know. The case can be made that we are in a very large IVth wave of the V wave pattern since post 2008 crisis.
=> From a technical perspective this looks like a very large correction and should not continue its decline further than 38.2% (4525.x)
=> Anything below here will start to show serious cracks in the uptrend and will suggest the top for French Equities (not expected) may already be set in stone.
=> Here for 2019 we will add exposure to the upside on the test of 4525 with tight stops at 4165.
=> Best of luck all those in French and other European Equities
EURZAR Long PositionExpect the EUR and USD to gain some strength over many developing countries currencies in the near future. We had a positive daily green pip movement corresponding nicely with our MACD! I am however going to be looking closely at the riots occuring this weekend in France as things can get out of hand really fast with the political climate in that country and the impact it might have on the Eurozone in general.
FRANCE40 INDEX (FRA40Cash) (CAC40) A quick scalp idea:
Price is currently moving in an rising wedge, and we will be looking to place short trades when the RSI indicator becomes relatively overbought. The price had already broken out of a ascending trendline from the monthly timeframe, therefore, short positions are highly feasible on this index.
France40 forming a head and shouldern pattern?FRANCE index is forming a H&S pattern? Looking for opening a long position.
Kick The CACThe French stock market is painting an inverted triangle formation. Though not yet confirmed, this can portend lower prices ahead. We are currently rounding over. A weekly close above the prior weeks' high would negate bearishness for now, whilst a weekly closing below the last swing low would confirm the pattern and target the purple area.
While pundits claim the US stock market rally, it is far more prudent to short markets that are seeing material capital outflows, especially in failed states such as France.
France 40 Index - Bullish OpportunityBullish momentum is present on France 40 Index. We can expect other Euro pairs to go up as well as the indexes show good bullish signs.
Selling Position - AUD/CHF I am so glad to be back posting after more then a year. My technical's are bleeding that its oversold but due to the fundamental for the Aussie being so poor keep a tight look on this but from what I can see its a great R:R. The technical side looks great. We haven't seen AUD/CHF at this level since 2016 so hopefully that level will be supported and expect a rally of at least 200+ pips. We also have a hidden bullish divergence so that should also tick another box of an upside.
EWQ in a retractionThe economists have said that France's business has slowed, but it just looks like a pullback/correction. This ETF charges around 49 basis points per year. It has some clear entry/exits. The best part about this ETF is France. C'est la vie.
Key levels to watch if trend keeps going downHere are the key levels to watch (the black horizontal lines).
CAC in the black list?CAC I do not trade this but is weird to hear a phone call from an old colleague of a French bank, but indeed this is not a call.
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Orange | A Potential BounceI am placing a small trade on Orange looking for price to go up to around 15 EUR.
I am stopping myself way down around 12 EUR.
A positive end to the year for the CAC40??After yesterdays negative day for the #CAC40, a bullish triangle pattern, also coinciding with Fibonacci support & resistance zones building out??
EURAUD LONG!Watch for long. It should try to retest that trendline in the next couple days. Elections coming up too.
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.
Understanding the Euro at it's current state. Update*This is an updated chart, taking into consideration other factors which are currently unfolding on the EUR/USD. The 200-SMA line has come close to the price action, possibly signifying a bounce to higher prices. However, there is a strong trend line nearby, where many other buyers will also be waiting. This area of demand can help facilitate more downward price action in favor of sideways or more upward buying pressure. Currently, buyers and sellers must work together to trade the price to a more favorable area, either higher or lower, but definitely not sideways.
Ideally, sellers will be able to bring in enough selling pressure, to push the Euro into further demand which will be waiting below, and allow then for the buyers to try creating some upward movement. This movement can then be taken on at a later date, once the Euro is safely below the 200-SMA.
These current indications of competition between bulls and bears are easily related back to the French elections, which had seen volatility pick up in the indices worldwide, as the current stock indices gapping up have been correlated to the elections themselves taking place. Now that Macron has won, prices seem to be turning around at a 'peak.' This is similar to the election in the U.S.A., with Trump's victory leading to new highs, however this is only stock market euphoria within the psychology of investors. As easily as prices went up, just as easily will prices come down.
XAGUSD 1D chartMarcon will win in France and FED will not hike rates.
My prediction for XAUUSD is downward move.
The french election - how will the markerts react?The french election. Who will win? Macron or Le Pen?
What does Le pen want with France?
Le pen is very anti EU (Europian Union), she believe that France should leave the EU. But why this? She is the partys "Front National" presidential candidate. This polical party supports nationalism, which (in this situation) means that the focus should be on France only, with closed borders and no Europian Union. If Le Pen wins the election, then France's membership in the EU may be over. Since France is a huge economy in the EU, it would affect the Union a lot.
Macron is not anti EU. He thinks France should stay in the EU. He is the partys "En Marche!" presidantial candidate. You could call him social-liberal. All in all, Macron sees positive at the EU. Which is positive for the Euro, since the chance of france leaving the EU is very low, if he gets elected.
So how will the markets react to all this polical stuff?
Well it is always hard to predict with a 100% certainty how the markets will react. The Euro has already reacted positive, since most people say that Macron will win. Many experts also predict that Macron will win. So the inverstors has become postive about the EURO. However, this is the same "experts" that said Hillary Clinton would win the election in the US. But what happened? Donald Trump smashed her. These experts also said that the UK would vote no to Brexit. What happened? They voted yes.
So lets say that Le pen wins. Then all this positivity we have seen in the euro the past weeks will be gone. And all the bulls will be trapped. It would most likely make the euro COLLAPSE.
Summed up.
Macron victory= Most likely positive euor
Le pen victory= Most likely a collapse in the euro
How to trade the first round of the French presidential electionTwo days before the first round of the presidential elections (23 April), the uncertainty remains high. Take the opportunity of a risk-friendly scenario or a strong risk aversion scenario by pending orders of both sides. The nightmare scenario for the market would be a second round between Far-left and Far-right candidates. Trade the EUR against JPY, considering the classical status of the yen as a safe-haven currency. For more information, visit fxparadigm.com
