Italy - 3rd Largest Economy in the EUItaly 40 Index - CAPITALCOM:IT40
Made up of 40 of the largest companies in the Italian equity market the Borsa Italiana , the IT40 gives us an idea of how the 3rd largest economy in Europe is performing.
The Chart
- 22 month cycles
- 22 months increasing and then decreasing
- Based on the pattern we are reaching the end of a 22 month period where price is typically up to 30% lower from current level.
- A bearish engulfing monthly candle appears to be forming here. If we close this month with a bearish engulfing candle, history would suggest significant down side will follow.
- We have not lost the 10 month moving average yet which typically offers confirmation of further decline.
Past patterns are no guarantee of a continuation of future patterns however we can watch out for the continuation.
Confirmation signals of significant downside which would be;
- Bearish Engulfing Monthly Candle (end of Aug)
- Losing the 10 month moving average
- In the event of same decline time window once in motion would be Aug - Nov 2023 (based on pattern)
Lets see what happens.
PUKA
