A bearish concatenation not seen in the Ibex since August puts pressure on a EuroStoxx on supports

The Ibex 35 faces the threat to register its second consecutive week of declines despite the rise of more than 1% that it added yesterday. This is a concatenation that has not occurred in the Spanish stock market since the markets were scared in August by the fear of an imminent recession in the US.

Since Monday, the Spanish selective has been one of the most penalized in Europe and has recorded falls that, although they do not reach 1%, have served to bring the index closer during some moments of the week to the supports it finds in the minimums of September.

It is about the 11,138 points which, although it is true that they are an intermediate level, are presented as the last hope of the bulls. And its reach and subsequent rebound from said environment is one of the hopes that the bulls maintain in the index today.

“It can stop the fall”says Joan Cabrero, technical analyst and strategist of ecotraderwho despite everything remembers that “the threat is that we are witnessing a larger-scale consolidation that could seek, in the worst case scenario, 10,900/11,000 points“

The threat of a major correction in the Ibex 35 is added in Europe to that of the German DAX 40, which may confirm a bearish pattern at the weekly close in the form of head and shoulders which would open the door to an additional 4% drop in the German stock market. “This pattern would be confirmed if he loses the 18,900 points which, for the moment, are resisting the downward advance,” says Cabrero.

In this sense, the push bearish in Spain and Germany, is what scares the EuroStoxx 50, which is already trading close to the support environment of the 4,675/4,700 points and? fear end up looking for the August lows around the 4,420/4,480 points.

“The good news is that if the DAX 40 loses support and we see a drop in future sessions of an additional 4%, we would be faced with a magnificent opportunity to buy back into the European stock market with a risk-return equation much more attractive than weeks ago. “explains Cabrero. “If we have that fall, it is likely that we will have a Christmas rally that would be easier to take advantage of than if there was not that fall,” he says.

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