CAC runs into sellers around 6096.07 for the third day in a row
CAC 40 Index (CAC) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CAC finished the week 0.66% higher at 6069.35 after losing €23.79 (-0.39%) today. Trading €19.15 higher after the open, CAC 40 was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on January 23rd, CAC actually gained 0.88% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (CAC as at Feb 14, 2020):
Friday's trading range has been €28.93 (0.48%), that's far below the last trading month's daily average range of €56.08. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CAC.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar.
Prices are trading close to the key technical support level at 6058.69 (S1). The CAC ran into sellers again today around 6096.07 for the third trading day in a row after having found sellers at 6098.26 in the previous session and at 6104.73 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 6104.73 where further buy stops could get triggered. Selling might accelerate should prices move below the nearby swing low at 6028.28 where further sell stops could get activated. With prices trading close to this year's high at 6109.81, upside momentum might speed up should the market be able to break out to new highs for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for CAC 40. Out of 118 times, CAC closed higher 53.39% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 60.17% with an average market move of 0.27%.
With four out of the other five Major European Indices closing lower today, the ones that stand out on the negative side are FTSE losing -0.58% and TECDAX closing -0.44% lower. On the flipside the best performer has been BEL20 closing 0.06% higher. Read more