At the end of the previous week, France CAC40 index grew, recovering some of its losses and returning to Tuesday’s closing levels. Besides technical factors, a growth in European indexes developed amid the publication of strong macroeconomic data for September in China.
In particular, the Consumer Price Index grew 0.7% compared to a growth of 0.1% in August. Experts expected the indicator to come out at 0.3%. On a year-on-year basis, the index advanced 1.9% from August’s 1.3% exceeding the forecast of 1.6% as well.
The Producer Price Index came out in the positive zone for the first time in quite a long time. In September, the index grew 0.1% after a 0.8% fall in August while experts projected a decline of 0.3%.
Support and resistance
Bollinger Bands on the daily chart is directed horizontally while the price range is narrowing from the bottom. MACD has turned to growth but is still keeping a sell signal. Stochastic has not reached the border of the oversold zone and turned up as well.
The indicators recommend waiting for clearer trading signals.
Support levels: 4460.5, 4425.9, 4401.3, 4383.1, 4359.7, 4338.7 (30 September low), 4306.7 (16 September low), 4290.7 (3 August low).
Resistance levels: 4486.5, 4504.3, 4528.3 (22 September high), 4568.1 (8 September high), 4581.2 (26 April high).
Trading tips
Long positions can be opened after the breakout of the level of 4504.3 (with the appropriate signals from the indicators) with targets at 4568.1, 4581.2 and stop-loss at 4480.5. Validity – 2-3 days.
Short positions can be opened after the price turns down and falls below the level of 4460.5 with targets at 4401.3, 4383.1, 4359.7 and stop-loss at 4510.0. Validity – 2-3 days.
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