We at FxWirePro believe that the global stock markets selloff that rattled investors’ nerves for two weeks might not be over, at least for the European stock markets. While the U.S. stock markets can enjoy the support of recently passed tax cuts and reforms, the European bourses lack such.
We have been short on Eurostoxx50 before the selloff even took place, http://www.fxwirepro.com/fxwire/popup/newsPopup?id=777979 and recently we revised our target for the Eurostoxx50 lower from 3100 to 2800, https://www.econotimes.com/FxWirePro-Call-Review-Eurostoxx50-short-target-revised-from-3100-to-2800-1146997
We have also revised our outlook for the German benchmark stock index DAX (GER30 in case of CFD), https://www.econotimes.com/FxWirePro-Call-Review-DAX-outlook-revised-from-bullish-to-bearish-1147363
We have also called on our readers to go short in the French benchmark stock index, CAC40, here, https://www.econotimes.com/FxWirePro-CAC40-trapped-in-Bull-Bear-fight-Sell-targeting-another-10-percent-drop-1152851
In this article, we would like to urge our readers to go short on the Spanish benchmark stock index, IBEX35. Compared to the European benchmarks, fundamentally this one remains much weaker given the fact that the Spanish unemployment, despite recent improvements remains at 17.1 percent as of latest reports. Even Spanish banking industry remains much vulnerable compared to other European countries, except for Italy.
Trade idea:
Our calculations suggest that the benchmark, which is currently trading at 9860 (ESP35) is likely to decline towards 7800 area. The stop loss for this trade should be maintained at 10680, which is 820 points from the current price.
