Concerns about China’s economy and a closely fought US presidential election continue to undermine the confidence of investors and analysts in recent hours, and have led the market into a phase of sideways consolidation.
The EuroStoxx 50 and Ibex 35 are the best example by remaining stagnant since the end of September (despite last week’s attempt to break the psychological resistance of the Spanish selective of 12,000 points). In fact, in recent days they have even approached the support levels whose perforation would warn of a more sustainable decline over time and would invite you to reduce exposure to the stock market a little and collect partial profits. It is about the 11,560/11,600 points of the Ibex 35 and the 4,870/4,900 points of the EuroStoxx 50.
One can only speak of weakness and short-term buyer exhaustion if the indices lose those lines, highlights Joan Cabrero, technical analyst and strategist at ecotrader. “Operationally, the strategy I suggest is to do what I call the accordion with the exhibition, that is, “increase as prices continue to rise and reduce it as these supports give way”
The EuroStoxx 50 is the index that is closest to the supports to watch. Specifically, it is less than 1% of said area. “If you lose the 4,900/4,870 pointswe could see a broader consolidation phase, which would not surprise me and would fit with what I thought could happen weeks ago, which would be more similar and proportional to the last consolidation phase prior to the August fall,” Cabrero warns. .
The transfer of said support would alert a broader consolidation, which could take the EuroStoxx 50 to the September lows in the 4,730 pointswhich is where the yellow line is, whose perforation would invite reducing exposure to the Old Continent’s stock market.
As long as that does not happen, the stock market exposure will have to be kept intact because the trading bias remains bullish.
#Time #accordion #bag
