CAC 40: The 7,900 points are pressure

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In the aftermath of an FED press release with a surprisingly firm tone, and while operators digest the unbalanced contours of the commercial agreement concluded between Washington and Beijing, the graphic resistance character of the 7,900 points is strengthened. This is in any case the main technical education of the week, which will end statistically by the NFP report (Non farm payrolls), federal monthly report on American private employment.

Here are the main consensus: overall, the market stakeholders questioned are counting on a very slight increase in the unemployment rate at 4.2% of the active population, moderate monthly growth in wages (+0.3%) and 106,000 postal creations in the private sector (excluding agriculture).

Investors continue to dissect the announcements of the American Federal Reserve (Fed) which opted on Wednesday evening for the status quo On its guiding rates on Wednesday evening, to the chagrin of Donald Trump. However, two of its members (Christopher Waller and Michelle Bowman) have spoken out against this maintenance, which had not happened since 1993.

“What made the meeting notable is the rare dissent of two governors of the Fed. Christopher Waller and Michelle Bowman have both pronounced in favor of a drop in rates. It is the first time since 1993 that two governors have expressed a divergent opinion. If these votes are involved in a context of increased political pressure from the Trump administration for a more flexible monetary policy, they also translate the accumulation of indices slowdown in the American economy “, decrypts Allison boxer from Pimco

Yet photography at the moment t Fundamentals of the first economy on the planet remain particularly solid, both in terms of employment and domestic consumption. But the difficulty of reading in the long term the consequences of the exacerbated protectionism of Trump embusing economic prospects.

Economists point out that the president of the Fed, Jerome Powell, adopted a more restrictive tone at the press conference he held in the wake of these announcements.

“Powell did not seem impressed by the strong pressures in favor of an immediate drop in rates, made restrictive remarks and gave no new indication on the future development of rates,” observes Barclays. “We maintain our forecast for a decrease of 25 basic points (0.25 percentage points, editor’s note) this year, in December,” added the bank.

The market also continued to follow the latest information on customs duties on August 1, when the United States will apply important customs surcharge on countries or groups of countries with which they have not concluded. Donald Trump announced that he would impose 25% customs duties on Indian imports on Friday to sanction the country to have oil and Russian military equipment.

In addition, according to European diplomatic sources cited by Reuters, European wines and spirits will undergo American customs duties by 15% from August 1. France hoped that these products could benefit from an exemption.

On the values side, a rain of quarterly copies animated the session. Accor dropped 9.60% after delivering income and growth in its disappointing network. Sanofi lost 7.8% while its net profit per share turned out to be lower than analysts’ forecasts in the second quarter. Bouygues also sanctioned heavily by the market (-7.3%) after revealing mixed results. Conversely, Société Générale climbed 6.9% so the bank exceeded the expectations in the second quarter, noted its objectives and announced a program of share buybacks of 1 billion euros. Safran, which also enhanced its annual prospects, jumped 3.1%. Legrand has advanced 13% after raising his margin target for the current year.

On the other side of the Atlantic, the main shares on shares ended the Red Thursday session, symbolically for the Nasdaq Composite (-0.03%), a little less symbolically for the Dow Jones (-0.74%). The S & P500, a reference barometer of appetite for the risk in the eyes of fund managers, lost 0.37% to 6,339 points.

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 $ 1,1430. The barrel of WTI, one of the barometers of appetite for the risk on the financial markets, was exchanged around $ 69.40. THE Treasuries 10 Yearsyield of federal sovereign bonds due to 10 years, was negotiated slightly above 4.38%. As for the Vix, it was worth 16.70 at the last fence of the S&P500.

At the macroeconomic agenda this Friday, to follow the final data of the PMI manufacturer in the euro zone at 10:00 am, consumer prices in the euro zone at 11:00 am, the NFP report at 2:30 p.m. and the ISM industrial PMI at 4:00 p.m.

Key graphics elements

The release of technical camisole was confirmed on 07/07, giving more meaning to the support on the mobile average at 20 days (in dark blue); And the index has just validated a phase of sweater (graphic rejection).

Now, a tidy (lateral canal) with an amplitude of 400 points is sketched, between 7,500 and 7,900 points. It is this resistance to 7,900 points that is currently tested. A test for the moment in the form of failure. A failure corroborated by the session of Monday July 28, materialized by a candle with a long red body, almost without shadow, or low. A replica on July 31, after two marked high shadow candles, confirms this market psychology on restraint.

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