TECH BRIEF - LONDON (EUROSTOXX 50)

An update on the EuroSTOXX 50.

 

This index has been particularly badly hit, falling 14% in four weeks. It has been dragged down by the Spanish, Italian and French components, and supported by the German ones.

 

There are some tentative signs of a base emerging. The structure, from the 2550 March 2012 high could be finishing its impulsive drop. At the same time, we could still only be finishing the wave III drop. In either case, a rally of at least 5% is soon to be expected.

 

This will most likely coincide with strength in US indices, a reversal lower in TY and possible new highs in Crude Oil (above $110).