CAC 40: New technical framework

(News Bulletin 247) – This article, with open access, is produced by the stock market analysis and strategy research team at News Bulletin 247. To ensure you don’t miss any opportunities, consult all the analyzes and discover our portfolios by accessing our Privileges area.

The aggressiveness that Donald Trump intends to demonstrate on the customs level brought down the CAC 40 on Tuesday. The flagship Parisian index, in thick volumes, broke the fragile floor of 7,340 points, to melt towards 7,200 points (-2.69% to 7,226 points). Unsurprisingly in this configuration, luxury will have weighed heavily, like Hermès (-3.42%), LVMH (-4.52%) or Kering (-5.76%), red lantern.

“The potential for trade tensions between the United States and China could further weaken Chinese consumer sentiment and complicate China’s macroeconomic recovery, which would pose a risk to the sector’s recovery,” UBS said this week. last.

This increase in customs duties would even amount to 60% on Chinese imports. However, according to the Financial Times, Donald Trump could appoint Benjamin Rubio and Mike Waltz to the respective positions of “Secretary of State” (equivalent to the Minister of Foreign Affairs) and “national security advisor” (a senior advisor on national security issues) . However, these two politicians are “hawks” in relation to China, summarizes Deutsche Bank. That is to say, they are known for advocating a tough policy towards China.

Donald Trump plans to increase customs duties from 10% to 20% on all imported products, even from the European Union.

On a statistical level on Tuesday, operators had to deal with a contraction in the ZEW economic sentiment index in Germany, the largest economy in the Euro Zone, which was losing momentum. The index sinks to 7.4, far from expectations (13.2). “The economic expectations score for Germany was overshadowed by Trump’s victory and the collapse of the German government coalition,” comments President Professor Achim Wambach.

“In the current survey, economic sentiment has worsened – and the result of the US presidential election is probably the main reason. The fact that economic expectations for the United States are clearly increasing, while Economic sentiment towards China and the Eurozone is falling, supporting this view. However, more optimistic voices were heard in the final days of the survey, expecting an improvement. “Germany’s economic outlook ahead of early elections. Overall, we are currently seeing a very volatile development in sentiment.”

On the other side of the Atlantic, the recent shower of records on the stock indices has given way to a breath of fresh air, on the Dow Jones (-0.86%) as on the Nasdaq Composite (-0.09% ). The S&P500 (-0.29%) closed below the symbolic threshold of 6,000 points, at 5,983 points.

An update on other risky asset classes: around 8 a.m. this morning on the foreign exchange market, the single currency was trading at a level close to $1.0600. The barrel of WTI, one of the barometers of the appetite for risk on the financial markets, was trading around $68.20.

On the macroeconomic agenda this Wednesday, to follow as a priority the consumer price indices in the United States at 2:30 p.m.

KEY GRAPHIC ELEMENTS

With a candle with a long red body on Tuesday, November 12, the index defined the amplitude of a new working base, between 7,200 points on the one hand and 7,340 points on the other hand, which we switch to chart resistance zone. The thick volumes of this key session, combined with the opening gap, give meaning to the threshold break.

FORECAST

Considering the key graphical 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 crossing 7340.00 points would revive the buying tension. While a break of 7200.00 points would restart the selling pressure.

Hourly graph

Daily Data Chart