Italy 40 (ITA40) Makes a Sharp Fall as Buyers Step In

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 showing the support levels of price. In May and August, the price tested the trend line and rebounded. The index reached a high of 25509. At the high of 25509, the market is said to be in an overbought condition. In the overbought condition, buying has been overdone. By default, sellers will be generated to push the Italy 40 downward. Nonetheless, the price dropped to a low of 21426. The downward move was very powerful as it broke the trend line. However, the downtrend caused the index to be oversold.

Daily Chart Indicators Reading:
Italy 40 fell below 20% range of the daily stochastic. This means that the index is in an oversold region of the market. It also means that price is in a strong bearish momentum. However, 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 also in an uptrend. There is no much difference in the first uptrend and the current one. The only difference is that the market fell to a low of 21200. The price pulled back to make a retest which resulted in further selling.

4-hour Chart Indicators Reading
ITA40 is currently at level 34 of the Relative Strength Index period 14. According to the Italian blog criptovaluta, 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 downward movement 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.

Instrument: Italy 40 (ITA40)
Order: Buy
Entry price: 21426
Stop: 20900
Target: 25000

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