Viva Espana! Ibex continues to make up lost ground. 7000 beckons…

Following yesterdays posts where we opined on the implications of the Put:Call ratio making a rare print over 1 (1.1 at its peak) and the deeply oversold status of Spanish equities in particular, it is not surprising to see the Ibex in the vanguard of European equity strength today.

With the index scratching against the 7000 level, as stated yesterday, any positivity in tomorrows Non Farm payrolls figures could propel stock markets higher and the Ibex is likely to lead the charge again.

For those readers inclined to a 1-3 week swing trade, the bullish set up on the Ibex is one of the best I’ve seen from a risk:reward perspective for a long time with a nice double bottom in place on the daily chart, the weekly stochastics turning up from extreme oversold territory and the recent downtrend line around 7050 about to be probed…

Just remember, as always, to watch your margin to allow you to ride out any volatility and not shake you out of your position. I am targetting the gaps up around 7400.

Good luck!