Technical Analyst, Saxo Bank Group
Summary: Covered in this Technical Update: AEX25/NETH25 cfd, BEL20/BELG20 cfd, CAC40/FRA40 cfd and SMI20/SWISS20 cfd
AEX/NETH25 cfd failed two days in a row to close above 795 and now seems likely to enter correction mode.
RSI topped out at 81 i.e., extremely overbought. If AEX is closing below its steep rising trend line a correction is likely to take the Index down to minor support at around 791 but a sell-off down to the 0.382 retracement at around 765 is not unlikely.
However, there is no RSI divergence which is indicating higher Index levels could be seen after a correction. That also indicates that the correction is not going to be a larger one meaning probably not all the way down to the 765 level.
A close above 798 will extend the uptrend BEL20/BELG20 cfd is at the time of writing back below the 3,728 /resistance/support level. A correction lower could be unfolding.
Support at around 3,632 and the 200 Moving Average is likely to be tested.
A break above 3,780 will most likely extend the uptrend to 3,823.
Minor divergence on the RSI is supporting the correction scenario
CAC40/FRA40 cfd looks quite toppish after forming a bearish candle 14th December following a gap higher at the open. If CAC40/FRA40 is closing below 7,526 and the lower rising trendline a correction is likely to unfold. A bearish move to around 7,330-7,300 is then in the cards. Some support at around 7,405 could cut short the correction
RSI with no divergence is indicating CAC40 could move to new highs after a correction. SMI20/SWISS20 cfd spiked higher last week but failed to close above 11,245. A correction seems to be unfolding. Support at 11,070 and 10,963-10,882
A close back above 11,245 would indicate SMI could resume uptrend to 11,400 resistance Quarterly Outlook
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