- Tested the trendline and is bouncing
- Technical picture remains bearish
ITA40: The outcome of the Italian general election pushes the ITA 40 index higher by 4.90% as of now in this week. Having a high at 22608 sitting tad below the 80.0% fib reaction seems at 22660 (22946-21535 fall).
Before retraced to 21535 the index was spotted with a bearish H&S pattern. The shoulders are spread between 22930 and 22946, indicating a near-term resistance zone established quietly. On the medium-term basis, supply zone remains between 23230 and 22946. By taking the H&S pattern into consideration selling on rise favors the near-term trend.
If we move to a higher time frame, on the weekly chart the index was capped with multiple tops spread between 24143-24260 levels.
August 11, 2017, low is the key support to bulls, fails to hold could open to the final journey to 20800 it’s corrective A-B-C pattern target.
View: Last down leg into 20800
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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