Spain’s Ibex 35 Index Mired In Long-term Congestion Zone

In the midst of political and social uncertainty surrounding the recent referendum in Catalonia to separate from the rest of Spain and Prime Minister Rajoy’s aim to stop it, Spain’s Ibex 35 Index has been faltering, as shown on both the longer-term Monthly chart and the short-term Daily chart below.

Longer term, price ran into major resistance in the form of a downtrend line and a 50% Fib retracement level. It’s currently hovering above the 40% Fib level. So far, neither the Momentum nor the ROC indicators are showing that higher prices are in store for this index on this timeframe.

Shorter term, a bearish moving average Death Cross has formed and price closed just below both of them on Friday. So far, the RSI, MACD and PMO indicators are not hinting of higher prices to come any time soon.

These technical indicators, resistance and support levels, together with the Death Cross formation, may be monitored to assist in determining the potential sustainability of any further decline or new rally that may ensue over both the short term and the longer term. A drop and hold below the long-term triangle apex at 9150 could produce a swift plunge to 7750, or lower.