Is the market somewhat withdrawn after Trump’s tariff threat and his reversal or, technically speaking, should the global stock market indicators and the Ibex 35 take us towards the zone of caution?
We once again saw Donald Trump’s typical weekend scare, which We are already quite used to what is called ‘TACO trade’which gets scared at the weekend and then quickly reverses at the beginning of the following week, but yes, there was a general scare, there was a massive sell-off, which we can see here, in this candle of the S&P 500, in which, indeed, there was a lot of fear, right?
The implied volatility there did increase and that raises the risk that there could be some short-term correction, which could be either a correction or a lateral range, but what is the part of the positive trend, well, at the moment in the short term it has initially broken downwards, so We will have to be a little more cautious, slightly more cautious than we had beforethere really was little, because the entire market was rising and here there was no concern.
Now there is a little more concern, and therefore, there may be a little more volatility in the short term, but the trend remains clearly positive. In the case of SP 500 support is at 6,484, the first relevant support, as long as it remains above it, then nothing happens, it is true that the corrective phase has begun as the price is below the 10-day average and now it would act as resistance, but well, at the moment it is not too worrying either.
If we see this as the North American market is and if we look at the Spanish index, the IBEX 35, well, we can get an idea, we see that we are consolidating, in fact in the selective with the Friday candle we did not lose what would be the bands here that we can see from ProRealTime, which show us that we are still in a positive trend, and for now simply consolidation in a lateral range with minimums at 15,265 y maximums around 15,700so at the moment there is no need to worry too much on a technical level, although obviously whenever there is a risk that there could be an increase in tariffs, well you always have to take it into account, it seems that with the retreat that in the end what there was seems to be a misunderstanding, because the United States thought that China was going to stop exporting rare earths and Donald Trump did not like that, then China said no, that was not exactly like that and Donald Trump also later he retracted, so well, it seems that a certain misunderstanding increased the volatility and that for now it has been nothing more than that, a scare. Better yet, let’s hope it stays there.
What values are interesting right now on the Spanish stock market?
I am paying a lot of attention right now to those who are doing very well, to those who are strong, and to each other at Endesa. Note that Endesa has broken upwards in the 27.30 areaI take it with ‘time’ from a few days ago and we have increasing highs and lows, the lows are very far away, a really bullish trend, because on the one hand good results, in the first half it had a net profit 30% more than the previous year and this is being seen well by the market, also in Spain the problem of control, voltage and the challenges of the electrical system give visibility to the sector currently and are causing investors to focus on this sector, which also tends to be the sector that usually acts defensively in times when there is a little more uncertainty, because in the end in the ‘utilities’ we know that the general problem is stable income.
Endesa as well as Iberdrola, which would be the other value that I would set right nowis very close to breaking the highs, 16,785. If we break this zone, these maximums, as in the past we said that if it broke 15.85, the most normal thing would be for it to return to the 16.77 zone and we are already there and now if it exceeds them, I would think that the most likely thing is that he will go around 18so very positive in this case the electrics right now in Spain, I would look at these two.
And on Wall Street, how exactly do you see the situation? Has there been a heating up in the indicators or does what has happened show the strength of the American market?
We saw a heat, obviously the heat was there, on Friday we saw it, we put it here again in Friday’s candle, we had to give us an idea a spectacular fall that was the worst day since April, so obviously that generates some uncertainty and increases volatility, as we said, implied volatility.
The subsequent rebound has not been a very reliable thing either. and therefore good because the normal thing is that there is, it can also be with the high valuations that we have in the market that there may be at any given moment, because it takes a break in the profits and that is good because on the other hand it can serve so that a market that we want to rise consistently has to have correctionsbecause if not they are not healthy increases, then if there is some additional correction without losing relevant key supports, then welcome because that can give us more strength towards the end of the year.
And how can we amplify our investments?
If we look for example, let’s give an idea, for example let’s imagine that we want to continue investing in Gold, which is one of the strongest assets, to put it another way, to talk about another strong asset at the moment we are talking about. If I wanted to talk about gold, for example, which we have also discussed on previous occasions, I can come to the barrier options platform and choose a barrier that is below previous support.
So, if it hits that support, the most I can lose is what is requested of me as the initial margin to open the position, so my risk is limited to the amount I already deposited, but if the operation goes in my favor, in the end everything that goes in my favor, because I can take advantage of the leverage and have a profit, that is, a return much higher than investing with other assets that also have limited risk, that is, if in the end we take and We look at profitability with respect to the investment made, since we can have much higher returns and for example, in the case of the S&P 500 or the Nasdaq, from the falls that we saw the other day, the fact of always having limited risk, because we have a barrier that limits our risk.
For example, here, let’s imagine that we had had a bullish position in the NASDAQ with a barrier below the recent previous minimum which was that of Friday in October, well, the most I would have lost is that, I would not have lost until the minimum that there was later, which here in this case yes in moments in which there is extreme volatility, like what happened on Friday, that we do not know when it is going to happen because it is in one or another in the scene and that at any moment it can It can also happen with China, which can also talk about a tariff war, obviously Having limited risk is an advantage and a guarantee at this time.
So I would look at the barrier options to be able to be fully covered right now and if there is a moment like that, then the position is closed, we know what we have lost and that’s it, and If the operation goes in our favor, we let the profits run and we will close them when we see a moment in which there is a clear signal to close positions.