Looking at the technical picture of the Banco Santander stock (BME: SAN), we can see that last week, on Thursday, it managed to break its medium-term downside resistance line taken from the high of July 25th, 2019. In addition to that, the share price continues to balance above the 200-day EMA, which may be seen as a bullish sign. That said, for now, SAN is struggling to push above its key resistance barrier, at 3.876, marked by the highest point of January. This is why we will take a cautiously-bullish approach, for now.
Eventually, if the share price rises and closes a daily candle above the 3.876 barrier, this would confirm a forthcoming higher high and may establish a new trend to the upside, at least in the near term. That’s when we will aim for the 4.040 obstacle, a break of which might lead to a test of the 4.150 level, marked by the highs of July 23rd and 24th.
Our oscillators, the RSI and the MACD, are slightly mixed. Although the RSI is above 50, it started pointing a bit lower. But the MACD is a bit more reassuring in regards to the upside, as it is above zero and its trigger line, while it points higher. The indicators support our position of staying cautiously bullish for now.
Alternatively, if the downside line breaks and the price falls below the 3.734 hurdle, which is the high of January 29th, this may spook potential new investors from entering, or force a few existing ones to liquidate part of their positions. That’s when we will aim for the 3.635 hurdle, which if fails to provide support for SAN, could clear the path to the 3.519 level, marked by the current lowest point of February.
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