The Paris Stock Exchange paused its attempt to rebound initiated the day before, like other European markets, still under pressure due to an uncertain geopolitical situation in the Middle East. Donald Trump’s statements hinting at possible negotiations with Iran had temporarily supported risky assets and extended energy prices, but skepticism persists, fueled by Tehran’s denials and the risk of increased involvement of some Gulf countries. Economically, the first activity data for March in industry and services revealed a marked slowdown in the Eurozone, as a result of soaring energy prices and persistent disruptions in supply chains. According to S&P Global Market Intelligence, business costs have increased at an unprecedented rate for over three years, while delivery delays have reached record levels, reinforcing the risk of stagflation. In this context, investors remain cautious, oscillating between hopes of geopolitical de-escalation and inflationary pressures continuing to weigh on European growth.
On the April future:
Resistance levels are at 7746 and 7790.5, possibly 7811, 7825.5, 7838.5, and even 8053.5, indicating a bullish trend above 8048.
Support levels range from 7709 to 7685.5, possibly reaching 7477, 7328.5, and even 7092.5.
Graphically, the CAC 40 Future has formed a bullish penetration pattern near the intraday target, after hitting the upper target of the long-term bullish channel at 7606 points. Crossing the intermediate resistance at 7838.5 points would confirm the rebound, aiming for the short-term bullish reactivation zone at 8053.5 points, with further bullish dynamic continuation towards 8740 points.
On the other hand, breaking the major support at 7685.5 points would signal the market’s struggle to confirm the rebound, possibly leading to a return to 7579 points and eventually a sharp drop towards 5850 points if the support at 7585.5 is breached.
In conclusion, it’s recommended to maintain Dynamic and Investor portfolios as long as alert levels are preserved at the close, favoring the bullish scenario but remaining vigilant for any invalidation of the current rebound. Adjustments to positions may be necessary if the index fails to sustain the present rebound, with a potential re-engagement strategy focused on optimizing entry points and risk management in the medium-term strategy.
