The IBEX 35 index continues its upward journey but now faces a significant hurdle at the 11,940 resistance level. This critical level has proven to be a challenge for buyers in the past, and the current price action suggests that the index is at a crossroads.
The broader market sentiment remains cautiously optimistic, with recent economic data providing support for equities. However, technical indicators highlight potential headwinds that could influence the next move.
Technical Analysis
📈 Moving averages support bullish sentiment.
The price is trading comfortably above both the 50 Weighted Moving Average (WMA) at 11,912 and the 200 WMA at 11,909, maintaining the bullish trend. These averages have flattened slightly, indicating consolidation. A breakout above 11,940 could see the index targeting 11,980, while a failure to break higher may pull the price back toward the 11,912 support level.
📊 RSI indicates consolidation.
The Relative Strength Index (RSI) is hovering near 59, signaling a balance between bullish and bearish momentum. If RSI climbs above 60, it would confirm a bullish breakout. Conversely, a drop below 50 could tilt the momentum in favor of the bears.
🔎 Fibonacci retracement suggests potential pullback.
The Fibonacci levels drawn from the recent swing low at 11,850 to the swing high at 11,940 show that the 23.6% retracement level aligns with the 11,912 support, offering a potential bounce point in case of a pullback.
Key Levels to Watch
- Support Levels:
- 11,912: Immediate support provided by the 50 WMA
- 11,880: Major level to watch if bearish momentum intensifies
- Resistance Levels:
- 11,940: Current resistance cap
- 11,980: The next bullish target
Fundamental Drivers
The IBEX 35 has been buoyed by a combination of strong corporate earnings and improving economic conditions in Spain. However, the broader Eurozone remains under the shadow of potential ECB policy adjustments, which could influence risk sentiment. Investors are also watching for updates on corporate earnings and macroeconomic data from key sectors, which could sway market momentum.
Outlook
The 11,940 resistance is a major test for the IBEX 35. If buyers manage to push the index above this level, it could pave the way for a rally toward 11,980 or even higher. However, failure to break through may lead to a period of consolidation or even a correction toward the 11,880 zone.
Traders should remain vigilant for any sudden shifts in market sentiment driven by macroeconomic updates or changes in risk appetite.
