Since the beginning of 2018, the French main index is running flat with a minor gain of 0.16% however, last week plunged more than 3.0%, and it made a phase change, shifting from a bullish to a warning phase.
Last week the main French index dived with a wide range and closed near the low of the week, in addition managed to close below the previous week low, which suggests a strong bearish momentum.
The stochastic is showing a strong bearish momentum although is still above the 50-mid line.
CAC 40 did not have the strength to follow through the 2017 high break at 5,534.5 and therefore began a steep downward correction, which may lead to the confirmation of the double top pattern.
Expecting an upward move to a Fibonacci expansion at 5,401.6 on a bounce from a weekly support at 5,235.0 (scenario 1) however a break below the higher zone of the weekly support at 5,235.0 may trigger another downward correction to the lower zone of the weekly support at 4,975.0 (scenario 2).