DBD Strategy Daily - EUROPEAN BANKS : TACTICAL BUY SOON
We think the banking sector plays a major role in the capacity of European indices to enter or not a sustainable bullish trend. For the time being, banks have been, and still are, in a sideways range. From a trading point of view, it is better to open positions close to the middle of the range. This is when the stop-loss is the closest to entry prices. This means that it is wise to buy banks now because the risk reward is favorable. This is not a high conviction view, as you know. But technical analysis shows us an opportunity, and whether we "believe" it or not is not necessarily important. The risk is low, the reward can be high. The probability for those events is unknown because no one ever knows about the future. Either the consensus is right, indices will be bullish in 2018, European indices will break to new highs in the coming days and continue rising in 2018 -and it is good to buy banks soon-, or the consensus will be wrong, and banks will not break out of the range, they will close the bullish gap, and that means there will be a small loss.
DayByDay is an independent research company providing global macro and single stock analysis, recommendation and allocation based purely on behavioural finance methods. Those include long term cycle analysis, sentiment analysis, and technical trigger. DayByDay serves all clients in need of practical and precise publications to make effective market decisions, on any time horizon, from a few hours to a few years.
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