Italy 40 (ITA40) Holds Above 21200 Support, Amidst Bullish Expectation


Key Resistance Zones: 24000, 25000, 26000
Key Support Zones: 22000, 21000, 20000

Italy 40 (ITA40) Long-term Trend: Bearish
Italy 40 is in an uptrend as the index reaches a high of 25427. On February 19, the index was overbought and the bulls were resisted. The market fell from a high of 25427 to a low of 17569. At this low, the index fell into the oversold region. The downtrend was very powerful as it broke the trend line. However, the selling pressure caused the index to be oversold. The price made pullback and it is retracing from the recent support level.

ITA40 – Daily Chart

Daily Chart Indicators Reading:
The index fell below 20% range of the daily stochastic. This means that the price is in an oversold region of the market. The implication is that selling pressure has been exhausted. It also means that price is in a strong bearish momentum. Nonetheless, when buyers emerge the index will make an upward move to the previous highs.

Italy 40 (ITA40) Medium-term Trend: Bearish
On the 4- hour chart, the index is in a descending channel. The price has also fallen to a low of 17512. The price pulled back to make a retest which resulted in further selling.

ITA40 – 4-Hour Chart

4-hour Chart Indicators Reading
Italy 40 is currently at level 35 of the Relative Strength Index period 14. ITA40 is likely to fall as it is below the centerline 50. Also, the 21-day SMA and the 50-day SMA are sloping southward indicating the downtrend.

General Outlook for Italy 40 (ITA40)
The downtrend of ITA40 may be gradually coming to an end as the index reaches the oversold of the market. Buying will resume concerning the oversold condition. The index is expected to rise to the previous highs. Buyers are expected to emerge in the oversold region of the market.

Instrument: Italy 40 (ITA40)
Order: Buy
Entry price: 18529
Stop: 17000
Target: 25000

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Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.