Red lines- bearish channel
blue lines- Fibonacci retracement levels
Eurostoxx50 is trading around 4,067. Our pull back target of 4,020, after breaking below 4,200, has been achieved. The Eu50 index has made a double bottom thus far around 3,990 and taking into consideration that the RSI is at oversold levels, the chances of a bounce have increased. Technically Eu50 index remains in a bearish trend making lower lows and lower highs. The decline has paused at the 38% Fibonacci retracement support. A bounce towards the upper channel boundary at 4,140 is justified and expected. Failure to stay above 3,990, will open the way for a new bearish wave towards 3,875.
