(News Bulletin 247) – At the end of a relatively volatile session, the CAC 40 confirmed, by its fall of 0.74% on Tuesday to 6,500 points in any volume, the lack of commitment of a large fringe of operators with the approach of important meetings on Thursday and Friday, against a backdrop of persistent fears about inflation, fears driving the Treasuries 10 years above the psychological threshold of 3%.
On Thursday, operators will be able to deal with the outcome of a new ECB Governing Council. If no direct action on rates, the Central Bank of Frankfurt will be scrutinized until the slightest inflection in its elements of lange, while inflation in the Euro Zone is on a historically high plateau. Friday will be published the consumer price indices in the United States.
“Barring a surprise easing on energy, this context of mistrust and tension on rates should remain in place at least until the ECB meeting on Thursday where the markets are awaiting clarification on the intensity and timing of the next hikes. rates”, warns Alexandre BARADEZ (IG France).
The unpleasant macroeconomic surprise of the day is definitely the dynamics of orders to German industry, which contracted by 2.7% in April on a monthly basis, completely missing expectations. As a reminder in March, the contraction amounted to -4.2% (updated figures).
On the stock side, note the rebound of 7.45% by CGG, taking advantage of a rise in opinion of Societe Generale, in addition to a buoyant context for oil. TechnipEnergies gained more than 5% and Vallourec 2.8%, while within the CAC TotalEnergies settled for +0.4%.
A point on the other risky asset classes: around 08:00 this morning on the foreign exchange market, the single currency was trading at a level close to $1.0690. The barrel of WTI, one of the barometers of risk appetite in the financial markets, was trading around $120.00.
On the agenda this Wednesday, to follow in priority the French trade balance at 8:45 a.m., the revised quarterly GDP data in the Euro Zone at 11:00 a.m. and for the United States, wholesaler stocks and crude stocks at 4:00 p.m.
KEY GRAPHIC ELEMENTS
The major test that we mentioned at the end of last week, namely the confrontation of prices with a bearish slant, is still not finished, in the sense that we do not yet have confirmation, either of a pullback, or of reintegration. Once again, today’s session will be instructive in this respect. The combination of “evening star” candles (May 27, 30 and 31), however, invites you to be on your guard. It didn’t stack on Thursday – it was our fear – with a combination of three black soldiers. This suggests a short drift in the immediate future, during which the dynamics of the volumes will be scrutinized. Note that the failure to cross 6,600 points on Monday reinforces this technical level in its role of chart resistance. We have represented it in bold.
FORECAST
In view of the key graphic factors that we have identified, our opinion is neutral on the CAC 40 index in the short term.
We will take care to note that a crossing of 6600.00 points would revive the tension in the purchase. While a break of 6330.00 points would relaunch the selling pressure.
Hourly data chart
Chart in daily data
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