Technical Update - Could be correction time for AEX25/NETH25, BEL20/BELG20, CAC40/FRA40 and SMI20/SWISS20
Kim Cramer Larsson
Technical Analyst, Saxo Bank
AEX 25/ NETH25 cfd Divergence on RSI is indicating down trend exhaustion, at least short-term.
Medium-term there is still downside potential after a likely rebound.
AEX could rebound to test the upper falling trendline but whether it can rebound to 740 or even 750 is questionable. Strong resistance at around 744. 100 Moving Average has moved below the 200 Moving Average supporting the underlying bearish sentiment
A close below 710 and the bearish trend will resume with potential 688
BEL 20/BELG20 cfd has reached October 2022 lows and could see a rebound. Sellers tried to push the Index lower from the get go Thursday last week. But soon after th opening bell buyers took control closing the Index higher. That could be a sign of a power exchange.
A rebound seems to be in the cards. Resistance at around 3,372 and 3,439
However, RSI is not showing divergence and if BEL20 is closing below 3,271 down trend is very likely to continue
CAC40/FRA40 cfd is bouncing from support at around 6,796 for a second time. RSI is now showing divergence indicating trend exhaustion.
A rebound to resistance at around 6,960 should be minimum. A close above could fuel further upside to text the upper falling trendline
SMI20/SWISS20 cfd formed a Hammer candle 23rd October. In combination with RSI divergence there is strong indicating of trend exhaustion and reversal.
A close above 10,449 could fuel a short quick rally to test the lower part of the Gap area at 10,598.
A close of the Gap i.e., a close above 10,676 could give further upside momentum
If closing below 10,251 the down trend is likely to continuing pushing SMI below 10K