We at FxWirePro believe that the global stock markets selloff that rattled investors’ nerves for two weeks might not be over, at least for the European stock markets. While the U.S. stock markets can enjoy the support of recently passed tax cuts and reforms, the European bourses lack such.
We have been short on Eurostoxx50 before the selloff even took place, http://www.fxwirepro.com/fxwire/popup/newsPopup?id=777979 and recently we revised our target for the Eurostoxx50 lower from 3100 to 2800, https://www.econotimes.com/FxWirePro-Call-Review-Eurostoxx50-short-target-revised-from-3100-to-2800-1146997
We have also revised our outlook for the German benchmark stock index DAX (GER30 in case of CFD), https://www.econotimes.com/FxWirePro-Call-Review-DAX-outlook-revised-from-bullish-to-bearish-1147363
A similar analysis of the French benchmark stock index suggests that the FRA40 (CFD of CAC40), as of now, remains trapped in a bull/bear fight. While bulls are eyeing a retest of the recent peak around 5520 area, the bears are eying another drop of at least 10 percent from the current price of 5240.
We would like to urge our readers to go short on FRA40/CAC40 since such will be in line with our calls for other European bourses and as the risk: reward ratio is extremely attractive for the downside. We would recommend a stop loss for the trade around 5520 area (recent peak).
