The Eurostoxx 50 is the benchmark index for European Stocks and one of the most actively traded futures contracts in the space. It topped out in November and has since sold off from 3,703 to 3,511 on Friday.
We bounced from there, but only back to the bottom line of a bear flag that I've had on my chart for a while now. This gave a fresh sell signal last week and the classic measuring technique attached to this pattern suggests the market can sell off to 3,379.
I have a more achievable target ahead of that at 3,430, where we have a Fibonacci level and a gap to fill.
Management and risk description
The initial risk on this trade is 40 ticks, which compares favourably to a reward of 110 ticks (better than that if you manage to run it to the second target as well).
Once below 3,522 and 3,511, move the stop to entry and watch for updates.
sell around 3,540-50 (currently 3,540).
3435, maybe even 3,380.
one or two weeks. Daily chart showing the bear flag:
Weekly chart (this has an uptrend line on it, which is my main worry about this trade. It's at 3,523 this week):
— Edited by Michael McKenna
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