Welcome to the last trading day in October! Markets try to rebound today and this reversal attempt is not happening randomly, oh no. Todays’ bounce is happening on crucial long-term supports, which actually increases chances for a success.
Lets start with SP500, where ahead of the American session, futures are creating the hammer candlestick. The tail of the hammer tests the 23,6% Fibonacci and at the same time lows from September and highs from June and July. As long as we stay above, buyers can be still fairly optimistic about the future.
DAX is having a similar hammer candle setup but this one seems a bit more reliable. First of all, we are in the middle of the German session and in addition to that, here we are bouncing from the 38,2% Fibo, not 23,6% and this first level is almost always more respected than the second one. As long as the price stays above the 38,2% there is still hope.
We will finish with the French index CAC. No surprise here as we also have a very similar pattern. Maybe the daily candle is not a hammer but its still bullish. What is more, maybe we are not bouncing from crucial Fibonacci line but we are still bouncing from a crucial support. In this case its around 4550, so an important resistance from March, April and May. As you can see, bulls still have hope and to be honest with you, it looks quite decent.
For a look at all of today’s economic events, check out our economic calendar.