DAX, CAC and MIB Forecasts – Europe is Looking to Bounce

DAX (Germany) Technical Analysis

The DAX in Germany has rallied a little bit early on Monday as it looks like we are trying to build a bit of a basing pattern here in what has been a very ugly turn of events until recently. Recently, we’ve seen a little bit of support and perhaps an attempt to turn things around.

The market could bounce to the 200-day EMA, and I think that would still not change much, it would still be just noisy consolidation. But what it’s worth noting here is that the market is at least trying to defend the crucial 23,000 level.

CAC (France) Technical Analysis

The CAC in Paris, of course, looks very choppy as well, but ultimately, when you look at this market, the 8,000 level above is a bit of a resistance barrier, and it was a previous support level. If we were to break above there, then the 200-day EMA comes into the picture for resistance.

All things being equal, I think this is a situation where traders are going to continue to at least try to defend this market, but the question is, do we get enough good news and, quite frankly, good risk appetite out there to turn things around? I wouldn’t trust it until it broke above the 200-day EMA.

MIB (Italy) Technical Analysis

The MIB in Italy looks like it is trying to bounce; it has been a little bit more resilient than a couple of the other indices. I suspect Italy could actually end up leading the way here. The 43,000-level underneath is your floor right there with the 200-day EMA.

If we can retake 45,000, then that could open up more upward pressure, which could end up sending the DAX and the CAC higher. While the MIB is technically slightly negative for the session, the actual chart structure looks a little bit more supported than the others. We had a massive gap higher, we have fallen to fill that gap, and now we are showing signs of buyers coming in to defend it.

Even if you’re not trading the MIB, this might be one worth watching so that you can perhaps use it as a tertiary indicator trading one of the other indices.