Trade view /
16 January 2017 at 13:33 GMT
So far this year, the Eurostoxx 50 has made two lower highs – on January 9 and 13.
Stochastics, RSI and MACD are all giving us a selling signal.
We can sell the Eurostoxx50 using EU50.I the Index CFD to play to retracement to 3,197.13 (38.2% of retracement of 2,974.38/3,334.81)
Sell 5 EU50.I at 3,296.52 or market.
5 EU50.I at 3,335 Stop Loss and 5 EU50.I at 3201 Stop Profit.
For peace of mind when you trade based on daily bar chart always place "One Cancel the Other" stop orders (OCO). Therefore, you control your maximum loss and you can capture your maximum profit even if you are not in front of your trading screen.
Target: 3.197,13 (38.2% of retracement of the last bullish wave 2,974.38/3,334.81)
NB: We place the stop loss just above the daily high of January 3 (3,334.81) at 3335.00.
We place the stop profit just above the target (3,197.13) at 3201.
Gross maximum profit: (3,296.52 - 3201) X 5 time the index = 477.60 euros.
Gross maximum loss: (3,335- 3296.52) X 5 time the index = 192.40 euros.
Overnight funding cost for 5 index = 1.37 euros.
Net Profit = Gross Profit - total overnight funding cost
Net Loss = Gross Loss - total overnight funding cost
— Edited by Clare MacCarthy
Non-independent investment research disclaimer applies. Read more