Although the week initially started out hopeful for the AEX and the global financial markets, a headwind from the bears is now slowly starting to emerge. The trade deal between China and the United States has undoubtedly had a positive impact on the AEX and the rest of the financial world, but a definitive solution still seems a long way off.
It is not surprising that the AEX is experiencing some resistance at this level. The index has gained almost 20% since the low point of early April, while the financial markets are generally going through a strong period. From this perspective, it would make perfect sense for investors to decide to cash in some of their realized profits in the coming days.
Don’t expect prices to always go straight up. That’s not usually the nature of markets. When prices rise quickly, there always comes a point when investors are satisfied and decide to cash out some of their returns.
If a correction occurs, it will be interesting to see how the 200-day moving average (MA cloud) can prove to be a support. If it does, it is usually an encouraging signal and you can say with more confidence that we are in a bull market.
However, if the AEX is unable to find support, the question arises whether the recent rise was just a last chance to sell before we enter a longer and deeper bear market.
What do you think? Are we heading towards a new bull market or are we already in the grip of a bear market?
What does the recent resistance mean for the AEX?
The recent resistance for the AEX could mean that investors are considering taking profits after a strong rally. This is a common reaction in the market and may indicate temporary fluctuations.
Why is it important to keep an eye on the 200-day moving average?
The 200-day moving average often serves as an important support or resistance level. A successful test of this level can indicate that the market is stronger than thought, while a failure can indicate a potential decline.
What are the opportunities for the markets in the near future?
The coming period could be decisive; there is both the chance of a new bullish momentum and the risk of a deeper bear market. It all depends on how investors react to current price levels.