The CAC 40 index is currently trading at 4,444.42, for a gain of 1.78% for the day, or 77.75 points. The index has a 52-week trading range of 3,892.46 on the low end and 5,283.71 on the high-end. The 1-year return is -9.69% and the year-to-date return is -4.15%. A big part of the reason why so many traders are currently bullish on this index is that of the 40 members in this index, 37 were up and 3 were down on 30 March. The strong upward momentum in the CAC 40 index began on Thursday, 24 March when it was trading at 4,329.68 and continued right through the Easter weekend until its present level at 4,444.42.
Speculative sentiment index for the CAC 40
The CAC 40 index is a barometer of the performance of the largest 40 stocks in France. The index is aggregated by way of free float market cap and liquidity. Now, let’s get into the thick of it and understand which direction the CAC 40 index is likely to move given the upcoming economic indicators. Recall that the index was closed on Easter Monday, but the resumption of trading on Tuesday the 29th and Wednesday, 30th March proved to be bullish for the French index. The release of economic data in the Euro CPI and unemployment results for Germany were major catalysts in driving this index forward. It is not only the CAC 40 that gained ground recently, it was other European indices that benefited from the positive performance in European economic data. Prior to the resumption of trading this week, the speculative sentiment index for the CAC 40 was positioned at 3.62. This is markedly higher than the reading from a week ago when it was 1.82. From a contrarian perspective it could indicate that declines are forthcoming for the CAC 40 index.
Overall Performance of Euro and GBP
Let’s take a look at some of the economic indicators to understand what markets are doing and how this all ties together. The EUR/USD currency pair is currently trading at 1.13232, the GBP/USD currency pair is trading at 1.43902, the EUR/AUD currency pair is currently trading at 1.47738 and the EUR/JPY currency pair is trading at 127.386. The majority of traders have shorted the EUR/USD pair, but the speech made by Janet Yellen earlier in the week was supportive of a weaker USD. This is a reason why I have highlighted the currency exchange rates of the EUR against the basket of other currencies.
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