Euro Stoxx 50 to slide towards 3860 on a break below 4010 – SocGen

Euro Stoxx 50 uptrend has paused after reaching 4415 in November. Economists at Société Générale note that the index could slump as low as 3860 on a break under the 4010 mark.

A short-term bounce is on the cards

“It has formed a Head and Shoulders and is near the neckline at 4010. The pattern points towards potential downside.” 

“Short-term, a bounce can’t be ruled out however the index has to establish itself above right shoulder level at 4260 to negate the formation.”

“If a break below the neckline at 4010 materializes, the decline could extend towards projections of 3910 and 3860.”