IBEX 35 Index Futures Forecast November 14, 2012, Technical Analysis

The IBEX 35 futures initially fell during the session on Tuesday, but found support at the €7600 level in order to form a hammer for the second day in a row. It looks like support is stepping up to the plate, and that we will see a move back up to the €8200 before it’s all said and done. This runs counterintuitive to many of the stock markets around the world, and as such Spain may be one of the better places to put your money at the moment.

However, it should be stated that the Americans sold off late into their session, and as such this could be reflected when the Spanish come back online. Looking forward, this area has been rather consolidated over the last couple of months, and there isn’t much in this chart does suggest that it won’t continue.

On a break of the highs from Friday, we would be more than willing to start buying the futures in this market and aiming for at least €8000. At that point time, we see a resistance level that could start to cause problems. However, this level is minor in nature, and as such we think that the €8200 level will eventually be reached by the buyers in this marketplace.

Spanish debt is starting to show higher yields, and as such this move could be reversed at any moment. Is because of this that we decide to keep tight stops in this market, as that is could come out of nowhere suddenly. With all things Spanish related, one can simply wait for a day or two until the next headline comes out, so of course we will be cautious.

Because of this, this isn’t necessarily our favorite market, but we do recognize the opportunity that has presented itself. We would only put on a small position at this point time, and certainly wouldn’t risk any serious capital at this point. We may be able to gain and add to your account balance at this moment time, but again, we are concerned about headline risks in this market.