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May 05, 2023
- 53.4 points is the STOXX Europe 50 Index's largest daily jump in 3 weeks.
- Price action is gradually approaching a key resistance hurdle at 4,323
The STOXX Europe 50 Index has been losing ground for 9 days Today's positive session could indicate a brief correction amid a broader downtrend, or, the start of a potential reversal. From an earlier low of 4,281, the STOXX Europe 50 Index is on track to end the session around 4,340.43 after gaining 53.43 points compared to the 4,287 close from yesterday's session (1.25%).
The index has been trending positively for about a month. Approximately 14 days ago, the STOXX Europe 50 Index reached a significant high of 4,408.59 but has struggled to hold onto its gains and declined 2.76% since then.
Following today's trading session, chart analysis suggests EuroSTOXX could be slowing down soon; it is getting close to the resistance line and is now at 4,323, only 17.57 points away. Crossing the resistance line could, however, suggest that further gains are ahead. Trend-following investors would be interested to note that the STOXX Europe 50 Index made an initial breakout above its 5 day Simple Moving Average at 4,319.28, a potential indicator of a newly emerging bullish phase. Analysis based on the asset volatility indicates that Bollinger Band® analysis indicates that current price action is approaching the upper band at 4,426, thereby suggesting that the STOXX Europe 50 Index is becoming overvalued.
Overall, the technical outlook suggests the STOXX Europe 50 Index is likely to remain muted for the immediate future, with no clear-cut direction.
Fundamental indicators – Euro Zone Interest Rate came out at 3.75, while a consensus of analysts was expecting 3.75.
Other markets are also showing gains as having closed the previous session at 33,128, Dow Jones is up 1.72% today to currently trade at around 33,700. Having closed the previous session at 4,061.22, S&P 500 is up 1.95% today to currently trade at around 4,140.5. Nasdaq is up 2.33% to 12,245.
Upcoming fundamentals: Euro Zone CFTC EUR speculative net positions scheduled to come out today at 20:30 UTC.
