From some perspectives Europe is on sale. When I look at the chart of the Euro STOXX 50, there is a potential double bottom at 2875. But that is not all. The Hammer candle (in the circle) is a reversal candle that was confirmed higher Monday. To round out the picture the RSI is making a new higher high. All that is needed for a clean sweep higher is the MACD to cross up. And that has leveled and near a cross.
But it is not just the broad Euro STOXX index that is turning. The German DAX at the conservative end has also made a double bottom and is turning up. It has the same characteristics in the RSI and a bottoming candlestick pattern.
At the other end of the spectrum the Italian MIB Index looks similar. A bounce off of double bottom support and a RSI that is turning back higher.
Each and everyone of these could fail but it is time to take notice because all markets and the Index are showing signs of a turn. Each offers a trading opportunity with a high reward to risk profile against the double bottom low. And each can be traded using ETFâs.
