Euro Stoxx 50 Index – remians negative below 3,691
· The Index is correcting the October 2014 – April 2015 bull cycle and it still remains unclear the shape or the dip of this correction. While above 3,374 it is still possible to see a move into a new cycle high as the correct wave structure from the 2015 high does look like a typical A, B, C correction.
· Watch the 3,374 low, if we do get a break below this level a move towards 3,312, 3,189 & 3,036 would take place (50%, 61.8% & 76.4% Fibonacci retrace levels)
· On the upside, watch 3,691 which is the recent lower high, while below it the Index maintains the path of lower highs and lower lows and remains within the boundaries of the bear channel.
· The Elliot wave count highlighted on the chart isn’t a trade decision maker and is pointed out differently on each research paper to highlight the various of possibilities in terms of wave structure.
Strategy: No position recommended, Step aside for now
Cac40 Index – remians negative below 5,193
· The Index shares a very similar setup as the Euro Stoxx 50 Index. While above 4,712 it is still possible to see a move into a new cycle high as the correct wave structure from the 2015 high does look like a typical A, B, C correction.
· A break below 4,712 would argue for a retest of the 200dma at 4,639 and a break below it would be clearly negative and argue for a deeper retracement towards 4,536, 4,360 and possibly 4,141 (50%, 61.8% and 76.4% fibonacci retrace levels)
· On the upside, watch 5,193 which is the recent lower high, while below it the Index miantains the path of lower lows and lower highs and remains withing the boundaries of the short term bear channel
Strategy: No position recommended, step aside for now
Dax30 Index- remains negative below 11,920
· The Index remians negative below the 11,500-1,635 area – this area represents the breakdown level of the longer term rising channel and th top of the shorter term declining chanel
· In the short term, the index ains the path of lower lows and lower highs and also below the 55dma (10,572). In order to suggest a low is in place will need to take out 11,920
· On the downside, the 38.2% fibonacci retrace at 10,847 held 3 times but if we do get a move below it a test of the 200dma (10,569) is likely to take place and a break below it would target the 50% retrace at 10,371, the 61.8% retrace at 9,895 and worse case scenario the 76.4% retrace at 8,354
Ibex35 Index – remians negative below 11,595
· The outlook is pretty mixed as the longer term setup favors a move to 12,500 (bullish traingle target) BUT in the shorter term the Index is trading in a declining channel and maintains the path of lower lows and lower highs which is a typical behaivior for a down trend
· In order to maintain the medium term setup the Index need to hold above 10,680, this level represents the traingle breakout level and should therefore provide support, a sustain move below this level would negate the traingle pattern and it’s target
· Looking ahead it will be necessary to see a move above 11,595 to negate the path of lower lows and lower highs and such a move (if and when occures) would also suggest a breakout from the short term declining channel which is bullish
Strategy: No position recommended, step aside for now
FTSEMIB Index – remians negative below 23,880
· The outlook is pretty mixed as the longer term setup favors a move higher but the shorter terms setup is slightly bearish below 23,880 – this level is the recent lower high and like other Indices while below this level the Index maintains the path of lower lows and lower highs and therefore risks a move lower.
· On a longer term perspective, the Index remians positive above 21,855-22,590 – this area represents the highs from June 2014 and the recent cyle low and while above it a move higher is still possible.
· A break back below 22,590 would argue for a re-test of 21,855 and a break below the latter would argue for a test of the 200dma at 21,214. A break below the 200dma would be clearly negative in be a sign of worry
Strategy: No posiiton recommended, Step aside for now
