From the short-term perspective, the IBEX 35 continues to climb higher, trading above its short-term upside support line taken from the low of August 15th. That said, it is currently getting held down by its 200-day EMA. Even if the Spanish index manages to overcome that EMA, still, the upside could be limited due to its medium-term downside resistance line, which is taken from the high of April 23rd. Until we see a clear break through one of the above-mentioned lines, we will remain neutral and continue observing the price action.
If the index fails to move higher and eventually breaks the short-term upside line, this could signal a change in the short-term uptrend. But more sellers could start joining in if IBEX 35 slides below the 9053 hurdle, marked by yesterday’s low. This way, the price could move further down and test the 8960 zone, which is the low of last week. This is where the slide might get halted for a bit, or the price might even rebound slightly higher. That said, if IBEX 35 struggles to push back above that upside line, the sellers could take advantage of the situation and send the index to the downside again. If this time the 8960 obstacle fails to withhold the bear pressure, a break of it could lead the price to the 8902 area, which acted as good support on June 3rd and also was the high of September 4th.
Alternatively, if the index climbs above the aforementioned medium-term downside line, this could increase its chances of moving further north, especially if the price breaks above the 9257 barrier, marked by the high of July 29th. This is when more buyers could be joining in and driving IBEX 35 to the possible resistance zone, at 9362, which is the high of July 17th. If the price stalls around there, it could even correct back down a bit. But as long as it stays above both of the aforementioned lines, we will remain positive, at least in the short run. Another push higher and a break above the 9362 hurdle could send the index towards the highest point of July, at 9450.
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