The IBEX has initially pulled back just a bit during the course of the trading session on Thursday but then turned around to show signs of life again. By doing so, the market is approaching the 9000 level again, an area that has been resistance several times. As you can see, I have formed a bit of an ascending triangle on the chart, and it looks as if we are ready to break out. If we do, then I think that the Ibex is likely to go looking towards the 9400 level above. That does not necessarily mean that we get there overnight, but that would be the longer-term projection.
The IBEX of course is a very volatile Index, as Spain of course is very “risk on”, but at this point in time that looks like a widely held belief. The market will continue to see risk appetite increase, and if that is the case then it is very likely that the IBEX will be one of the major beneficiaries. The 50 day EMA currently sits at the 8863 level and is curling higher, and as a result it is something to watch as well, as the market has shown the 50 day EMA to be somewhat important as a “flipping point” in the market. Regardless, the IBEX will get pulled right up with other indices such as the DAX and CAC. If those two indices go higher, that should give traders a little bit of momentum to start pushing this one higher as well. This is a market that continues to see upward pressure overall, but if we were to turn around and break down below the 8800 level, then it is likely that we go looking towards the 200 day EMA.
The market has been grinding higher ever so slightly for some time, and now that we have built up inertia, we could see a bigger move. The IBEX is known for sudden moves, as a lot of the money flowing in this market comes from out of the country and is essentially “hot money.” It is also based upon a lot of real estate and vacation type companies, so it obviously does not move the same way as certain indices do that are considered to be more or less “Staples of the marketplace.”
