FTSE 100 and CAC 40 remain bid while DAX 40 lags

FTSE 100 trades at three-month highs

The FTSE 100 has managed to rise to a three-month high close to the 7,577 August peak amid ongoing risk-on sentiment due to lower-than-expected European inflation data in countries like Spain.

Short-term the FTSE 100 is likely to be capped by the August high and may thus slip back to the 7,515 September peak and also towards the minor psychological 7,500 mark, slightly below which most of last week’s highs were formed.

While Monday’s low at 7,421 underpins, the medium-term October-to-November uptrend remains intact. Above the 7,577 August high lies major resistance between 7,621 and 7,671, made up of the April-to-June highs. This area is expected to cap into year end, if reached.

DAX 40 consolidation ongoing amid European inflation data

The DAX 40 is taking a breather, following its steep around 23% October-to-November advance amid stubbornly high Covid-19 cases in China and lower-than-expected inflation at 6.8% year-on-year in Spain and steady inflation at 6.2% year-on-year in France.

Towards the end of last week, the index ran out of steam slightly below its April high at 14,599 and has since slid back to Monday’s low at 14,325, close to the October-to-November support line at 14,322.

Slips below 14,322 should find support around the mid-November lows at 14,150 to 14,125.

In case of a currently unexpected rise to above the 14,584 to 14,599 resistance zone being witnessed, the June peak at 14,712 and the March high at 14,927 would be eyed.

CAC 40 remains on track to reach 6,759 late April high

The French CAC 40 index continues to advance, albeit in a more gradual fashion than in October, as the country’s inflation rate remains unchanged at its 1985 highs of 6.2% in November and market participants await Eurozone Consumer Price Inflation (CPI) data and Jerome Powell’s speech after hours in Europe.

Provided that the CAC 40 stays above this week’s low at 6,641, the 6,759 late April high remains within reach, despite the index so far having already risen by around 20% since early October.

The late April high at 6,759, together with the late March high at 6,831, offers a solid resistance area which may well cap the CAC 40’s advance in the days ahead, though.

Immediate support can be spotted between the 6,686 mid-November high and the 6,626 August peak.