CAC 40 Technical Analysis Short Term
Published 29th October 2018
The main question for the CAC 40 is if the mid-October countertrend wave was a fourth or a second wave. Both scenarios are possible. A second wave implies further extension potential to the downside. We slightly prefer the red version. All in all, French equities are most likely very near to a countertrend bounce. Second waves and bear market rallies are usually deep. Their job is to bring back complacency and confidence in a strong market. We expect a sharp short-term rally soon. It will most likely set the stage for a bigger sell-off during 2019.