Technical analysis: IBEX 35

We will see the Ibex 35 from the perspective of three different investors: long term (traditional investment fund and pension plans), position trading and short ).

In today's post I will not go into fundamental analysis reasons, we will simply see, through technical analysis what our index looks like TODAY. Remember the less seasoned that green sails are bullish and red bearish. I will only use an oscillator and in the monthly time frame for its importance (the Macd) and Heikin Ashi candles in daily time frame for their veracity validating trends.

As you well know technical analysis has a mixture of science and art. This is my interpretation.

Long term : Ibex in monthly time frame with Macd. Logarithmic Scale

From April 2015 high is bearish. At the moment he has stopped the falls but he shows no strength to climb again. The Macd is below zero and below the signal. In the long run it is bearish-lateral. It is not lowering, but no sign of rebound, although (you know that there is always a though), although it is gaining momentum and the Macd points (only points) to a close bullish cross.


Medium term . Ibex in weekly time frame. Logarithmic scale

In my opinion there is a key level that is the area of ​​9,500 (always zones although we concretise them in a concrete number). Since October 2013 is a zone tested on several occasions and since breaking it at the beginning of 2016 has not stopped being bearish and always move below that level.

In medioplacista vision our Ibex is like the Galician that you are in the landing, it does not seem that wants to descend much more, but neither does it invite us to climb to his hump.


Short term : Ibex in daily time frame. Candles Heikin Ashi. Logarithmic scale

The Heikin Ashi takes the immediacy of the graph but gives us a much clearer and more convincing idea of ​​the trend … when there is a trend.

One of the characteristics of these candles is that in sustained trends they have the same color. Notice the alternation of color (green / red) in the last days. He does not know where he is going.


Let's see it with zoom (previous enlarged idem):


Notice that from mid-September it is green-red-green-red without moving anywhere on a channel of 7% amplitude. Little room for swing trading (great for day trading)

To close the circle we will see two indexes that influence the Ibex. The kaiser (DAX 30) and banks are the sector that by far weighs more in our index. The banks will see them through the European sector.

DAX 30: ever lower low, but ever higher lows. Side market without trend but at the same time drying of volatility. A strong decrease in volatility can be (usually) the prelude to a major move to where? Until it breaks on one side or another we will not know.


European banks : there are no words left. I will repeat below this graph the one of our Ibex in week and I save the comment. The coincidence is almost total. I invite some strong reader in mates to take out a R squared or any other measure of correlation. Some of you may think that you have found the stone and that the sector of banks can be an anticipatory indicator of our Ibex. In my opinion they are totally coincident. The only conclusion I can draw (and I'm leaving the technician) is that if the Deutsche ends badly the Ibex will suffer more than any other European exchange. And if it ends well, champagne and break resistances. In Ibex you can say that of "banks mandan."



The conclusion, by technical analysis, is that today we are without clear direction. This information may not tell you much but I think if you agree with the reasoning that follows.

It is difficult for a value to escape from its index, especially from a small and narrow index.It is true that there will always be two or three values ​​that will do much better but what are your chances of guessing those two or three?

Probabilistic logic tells us that almost any index value will go up if the index goes up, it will go down if the index goes down and it does not know it does not answer if the index does not know where it is going

In the market there is a clear drying of volatility that usually precedes great movements, to which we add that October is the month of the soils (and the scares). Just in case you have your finger on the trigger … .but do not shoot before time.

Good investment!


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