Analysts and investors have an appointment today with the weekly close. It is an appointment that seems to be of vital importance strategically speaking for the stock markets of Europe. Especially after the temporary loss of supports that was seen last Tuesday and the subsequent recovery.
Friday’s session acquires great relevance in order to confirm whether the risk of witnessing a more relevant fall as raised by the transfer of key supports in the SX7R banking index is feasible or if, on the contrary , the bullish counterattack seen in the subsequent days , which has once again put pressure on the European stock markets in the first resistance zone, whose overcoming at the end of this week is a sine qua non condition to trust in more gains in the days to come.
This is the 3,500 EuroStoxx 50 points . “It is the minimum required that should happen at the end of this week to trust in the current bullish counterattack “, explains Joan Cabrero, technical analyst and adviser at Ecotrader , who points out that “the next step would be for it to overcome the resistance of 3,600 points ” .
“Overcoming these resistances would remove, at least temporarily, the risk of witnessing a more relevant fall, as suggested by the transfer of key supports in the SX7R banking index, and once again the door would be opened to the possibility of witnessing a strong recovery that could seek the zone of 4,025 points “, highlights the expert, while emphasizing the difficulty of this happening.
In the case of the Ibex 35 , the short – term rebound seems to be vulnerable and in order to be able to trust in the success of this bullish counterattack , the minimum required is for the Spanish selective to overcome the first resistance levels it presents at 8,240 and 8,400 points .
A little closer to parity in the euro/dollar
The euro/dollar cannot even rebound. The cross between the two currencies is not raising its head and is getting closer to reaching parity after giving up support this week and touching (and later drilling) lows not seen in the last 20 years . “I fear that we will end up seeing parity and probably lower levels ,” says Cabrero, who points out that the Dollar Index has recently opened the door to a potential upward run towards the 2001 highs in the 121 zone , which would mean a 13% travel .