EUROPEAN SHARES
Markets drifted shortly after the opening bell in Europe on Friday, following a mixed sentiment in Asia, as investors digest the latest US inflation data.
Yesterday’s inflation report didn’t surprise investors after showing the expected decrease in price pressure (7.1% to 6.5%).
While this should be seen as positive economic news, the fact that a lot of it was already priced-in earlier this week is having a negative impact on today’s market sentiment as investors are now “selling the news” and taking profit following a 9-day bull run.
The likelihood of a pull-back or sideways trading has increased today after most benchmarks have now broken-out of the lower band of their bullish channel, invalidating the short-term bullish trend. The DAX-40 still trades above the 15,000.0pts level after the German index failed to clear the strong 15,115.0pts/15,135.0pts resistance mentioned in our previous analysis.
The first support can be found over 15,000.0pts while an extension of the market correction could lead prices to test newly established market floors such as the 14,820.0pts zone (23.6% Fibonacci).
Pierre Veyret– Technical analyst, ActivTrades
Source: ActivTrader
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