The CAC 40 returns close to an important pivot at 6100 points
In terms of technical analysis, the CAC 40 has been gaining ground since last week after returning to test its lowest point of the year at 5750 points in early July. The outlook turned bullish again in the short term the day after the low after the formation of a “harami” pattern.
The CAC 40 could continue its short-term rebound until it comes back to test an important pivot zone at around 6100 points which corresponds not only to the recent high, but also to the May low.
A crossing of this threshold would allow an exit from the top of the Bollinger bands, which would strengthen the bullish outlook and open the way for a continuation of the rebound up to 6500 points.
A rebound up to this price level would be potentially attractive to position yourself short in the direction of the underlying trend in anticipation of a further deterioration in the economic outlook.
Entrance: Purchase above 6100 points
Stop: 5900 points
Objective: 6500 points
Risk/reward ratio: 2
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