Looking at the BBVA stock (BME: BBVA) from the short-term perspective, we can see that it is now trading slightly below a medium-term upside support line drawn from the low of October 8th. That said, the price remains above the 4.72 hurdle, which is the low of last week. For now, we will take a cautiously-bearish approach and wait for a daily close below that hurdle first, before getting a bit more comfortable with further declines.
Eventually, if we see a daily close below the 4.72 zone, this may force a few existing investors to liquidate some of their existing positions, as the risk of seeing a further slide might be elevated. This is when we may consider a possible move to the next support area between the 4.60 and 4.63 levels. The stock could temporarily stall around there, but if there are still no takers of BBVA at those levels, it may resume its journey south, potentially targeting the 4.46 area, marked by the lowest point of October 2019.
The RSI and the MACD are near their lows. Although the RSI recently rebounded a bit, still, it is below 50 and points lower. The MACD is currently flat, it sits below zero, but remains fractionally above the trigger line. Both indicators are somewhat in support of the above discussed scenario.
Alternatively, if the price climbs back above the previously-discussed upside line and then moves above the 4.85 barrier, marked by the high of January 17th, this could also place BBVA above the 200 EMA on the 4-hour chart. Such a move might spark a bit of hope in the eyes of potential new investors. We will then aim for the resistance area between the 4.94 and 4.96 levels, marked by the lows of January 6th and 8th respectively. If the buying doesn’t stop there, a break of that area might clear the path to the next resistance barrier, at 5.12, which is currently the highest point of January.
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