After a week in which sales clearly predominated on the world’s main stock exchanges, selective values such as the EuroStoxx 50 have approached the first support levels that could halt declines such as 4,790 pointscorresponding to a 38.20% Fibonacci retracement of the entire bounce.
“Any break of this first theoretical support should be interpreted as a sign of weakness, suggesting that the consolidation could be broader and more complex, possibly with two descending waves or a zigzag pattern (fall – rebound – fall) before finding a bottom and resuming the rises,” warns Joan Cabrero in the first episode of the season of the Investment Strategy podcast, while asking not to be in a hurry to buy.
“I fear that a potential bounce is vulnerable and part of this zigzag that could take us to levels where I would consider it appropriate to buy. These levels coincide with a 61.80% or 66% decline in the bounce, which would put EuroStoxx 50 at 4,650/4,670 points and Nasdaq 100 at 18,285/18,390 points“explains the expert in his strategic commentary this week in which he points out that this is where “we could draw in search of an increase scenario in the coming months.”
Furthermore, the level that would need to be lost to cancel the short/medium term uptrend and justify a reduction in stock market exposure is also highlighted. This key support is found in the 5,100 points of the S&P 500 and is currently 7% distancebut if the buying is done around the 61.80/66% adjustment of the rebound, which in the S&P 500 would be 5,300/5,325 points, the risk would be reduced to just 4%.
In the case of the Ibex 35, the first major support is located in the 11,000 pointscorresponding to an adjustment of 38.20% of the increase described. Without reaching it, I refuse to believe in a possible rebound. By losing 11,000 points, the information that the market would give us is that the consolidation could be broader and deeper, and could go towards the 10,690-10,740 pointswhere it would be an opportunity to buy.
On the corporate side, buy levels have also been indicated for laggards or holdouts in stocks such as Nvidia, which would offer an entry opportunity after correcting two-thirds of the last rally if it falls to the $90/$88 area.
