DAX, CAC and MIB Forecast – European Indices React to War on Monday

DAX Technical Analysis

The German index has shown itself to be rather negative during the Monday session, which is probably not a huge surprise considering that the markets are digesting the idea of a new Middle Eastern war. Generally speaking, we are seeing a sell-off across the board on indices globally.

The question, of course, will be whether or not this is something that has any sustainability to it. We are in an uptrend in the DAX, and I do think that there will be some interest in this general vicinity to find buyers. We’ll have to wait and see. I suspect maybe a little bit of patience goes a long way here.

CAC Technical Analysis

The Parisian CAC has fallen all the way back down to the 8,400 level, an area that previously had been resistant and now should be supported. With that being the case, a turnaround and a bounce from here opens up the possibility of a move to the 8,500 level, possibly even 8,650 again. We are starting to react exactly where you would want to see it.

MIB Technical Analysis

The FTSE MIB in Italy initially tried to rally in a bit of a counterintuitive move, but has since fallen during the session here, and now it looks like we’re going to enter a little bit of a pullback. That pullback should and could very well end up being a nice opportunity to buy cheap contracts here.

I think there’s support all the way down to the 46,000 level, and really, to be honest, looking at these charts, especially in Italy, the damage isn’t as bad as one would have expected. So, I think maybe this is a short-term blip on the radar.

If you’d like to know more about technical analysis and how traders use it, please visit our educational area.