IBEX35 Possible Downward Turn

23. Apr.

Europe's stock markets have extended initial gains at the start of the session and have recovered around 1% from the previous day. The British FTSE100 is back to its historical highs, while the EURoStoxx 50 is once again pushing towards 5,000 points, with SAP being the company that has published the best results report, climbing close to +4%. The Dutch company Prosus also stood out with +3.8% and Philips +2.5%.

The IBEX 35 started yesterday with a strong start and today has continued to climb one and a half percentage points after concluding the third best day of the index so far this year. It is in the 11,000-point zone, with a record high of 11,110.28 points. Last week it returned to a low of 10,497.21 points, but on the 17th it began to climb back to the highs. And at the moment companies that were put into question such as Grifols stand out as the most bullish component (+5.3%) within the index, after announcing a successful award of corporate bonds valued at 1,000 million euros. It is followed by Banco Sabadell (+2.1%) at the top while companies such as AcelorMittal (-1.6%) stand out for their poor results, followed by Unicaja (-1%), Enagas has also reported its accounts and is down today despite beating its profit forecasts.

PMI news from several European countries including the Eurozone and the UK are due today. And in the afternoon US PMI, Exports, Services and Manufacturing from the FED, as well as new home sales, which in the US have a high impact.

Regarding the IBEX 35 in the technical aspect, as we said, the index has been recovering its price. At this moment, it is with a very oversold RSI, so it is quite predictable a turn to the mean, which coincides in the strongest trading zone with a POC of 10,078 points approximately marking the bell to a low zone, so we do not know if this positive data will be enough to keep the Iberian index on its way up or there will be a strong correction and a test at 10,497.21.

If we look at the DAX40, while it is true that as the indices have been presented to the upside this drag has pulled the IBEX35, and the candlestick figures seem quite correlated since the 18th. So there may be a partial replica in both and it is likely that its technical representation is similar and is associated with German production data since Spain has among its main customers Germany in its trade balance, and this could be a reason for so much euphoria in the IBEX.

Ion Jauregui - AT Analyst




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