The technical picture of the Capgemini SE stock (EPA: CAP) on our 4-hour chart shows that, after reversing north on March 7th, the share price has been slowly grinding higher, while trading above a short-term tentative upside support line taken from the low of March 8th. Last week, CAP was able to overcome a short-term tentative downside line drawn from the high of February 2nd, which adds more positivity into the near-term outlook. That said, in order to get a bit more comfortable with the upside, we would first prefer to wait for a breakout above a resistance area between the 195.75 and 196.25 levels, marked by the current highest point of March and the high of February 15th respectively.
If, eventually, a break above that resistance area happens, this will confirm a forthcoming higher high, potentially clearing the path towards the 202.60 hurdle, which is the high of February 9th, where a temporary hold-up could happen. Even if the share price drifts back down a bit, as long as it remains above the aforementioned upside line, we will continue aiming higher overall. A break above the 202.60 obstacle, may open the door towards the 207.80 zone, or even to the 211.80 level, marked by the low of January 5th.
The RSI and the MACD are currently pointing slightly to the downside. However, the RSI is still above 50 and the MACD, despite sitting slightly below the signal line, continues to run well above zero. Overall, the two indicators show positive price momentum, which supports the above-mentioned scenario.
Alternatively, if the previously discussed upside line breaks and the price falls below the 188.00 hurdle, marked by the low of March 18th, that could open the door to some lower areas. CAP may fall to the area between the 181.00 and 182.25 levels, marked by the high of March 15th and the low of March 16th respectively. If the slide continues, the next possible target might be at 174.80, or even at the 171.45 zone, which is the low of March 11th.
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