CAC 40: Reinforced resistance status for 7,900

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Louvoiements, procrastination, threats and reculades: the markets are tired of the choreographed ballet of Donald Trump on customs taxes which he intends to apply to his commercial “partners”. And yet, they must continue to deal with … yesterday the CAC 40 index left forward by earning 1.21% to 7,828 points, thanks to a new postponement of customs surcharges against the EU.

Friday, he lost 1.65%, after the new “pressure” tariff addressed by Trump to the European Union. The brutal tenant of the White House threatened with customs taxes of 50% on June 1, against 10% today. The American president justified this announcement by the difficulty of commercial negotiations with Europe. Before changing, so …

Note that the volumes was reduced on Monday, in particular due to the closure of Wall Street for the Memorial Day (tribute to the members of the armed forces of the United States who died in combat all wars combined).

“With the announcement yesterday (Sunday, editor’s note) of Donald Trump that he would leave more time for negotiations, with an increase in prices now scheduled for July 9, he again shows that he is retiring before the negative impact on the markets of his decisions,” observes Sebastian Paris Horvitz de LBPAM.

“It is difficult at this stage to determine with certainty where this confrontation will end. However, the most likely is that these 50% rates will not be applied. Donald Trump should go back. At the same time, it is possible that the rates can be established higher than the current 10%,” he continues.

On the values ​​side, the vast majority of the CAC 40 ended in the green. The best performances were signed by cyclical titles such as Stellantis (+4.8%) and ArcelorMittal (+4%). The very volatile securities of automotive equipment manufacturers, very sensitive to the customs problem, flambé, like Forvia (+4.75%) and Valeo (+4.97%).

A point on the other asset classes at risk: around 8:00 am this morning on the exchange market, the single currency was treated at a level close to $ 1,1400. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 61.60. THE Treasuries 10 Yearsyield of federal sovereign bonds due to 10 years, was negotiated slightly above 4.55%. As for the Vix, it was worth 22.29 at the last fence of the S&P500.

At the macroeconomic agenda this Tuesday, to be followed in priority across the Atlantic, orders for lasting goods at 2:30 p.m. and the consumer confidence index (Conference Board).

Key graphics elements

The gradual cap under the 7,900 points has suddenly turned into intense volatility. In one session Friday, May 23, the Parisian flagship index broke the Dynamics of the spring rally by breaking the mobile average at 20 days (in dark blue), the difference compared to the mobile average at 50 days (in orange) has taken up strongly.

The 7,900 points are reinforced in their graphic resistance status.

FORECAST

In view of the key graphic factors that we have mentioned, our opinion is negative on the CAC 40 index in the short term.

This downward scenario is valid as long as the CAC 40 rating index below resistance at 7900.00 points.

Hourly data graphics

Daily data graphics