CAC40 Index: Fibonacci Level Combined With Supply
The 5%ers' Blog > Trading Analysis
As we can see in the H1 chart, the CAC40 index has suffered from a significant drop in 02/12 and 03/12 as most of the stock market indices in the world.
I have pulled the Fibonacci from the beginning to the end of this drop.
This drop creates a great fresh supply above and it seems the price on its way to reaching there.
This supply is also 0.236 Fibonacci level of the last drop.
This confluence of fresh supply and 0.236 Fibonacci level creates a strong setup to sell the CAC40 Index.
If we look to the left in the chart, we can see that this level is also a critical support/resistance zone that broke out by the fresh supply above.
I’ll sell at the first touch of the price in that supply above.
The first target will be Demand – 1 at the picture which is 0.786 Fibonacci level.
The final target will be Demand – 2 at the picture which is 1.618 Fibonacci level.
This analysis is relevant for swing traders.
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