There is no doubt that the Tokyo 2020 Olympic Games will be the strangest ever seen in history because of the conditions in which they will be held. The absence of public in the stands , the social and health situation in which the city where the vast majority of competitions will take place, the circumstances – not only sports, but also emotional – in which athletes arrive at the sports conclave, the last minute absences derived from the inclement weather of the pandemic … There are many news that limit the sporting event in this edition. More than ever, maybe.
However, the three most representative symbols of the Olympic games will remain unfazed: the Olympic flame, the interlocking ring flag and the medals to reward the efforts made by the competitors.
The latter are precisely those that investors and analysts try to impose on the Ibex 35 companies that reach the most attractive purchase levels. Those that may represent a potential turning point or a large-scale support that slows down its declines on the market and that allow us to mark a before and after in the medium term.
To put the investor in context, it should be noted that these are levels, all of them analogous to the 7,700 points of the Ibex 35 . That is to say, homologous to the lows of the year, which at that time also halted the falls of the index in the month of December.
“I don’t expect, far from it, a similar drop in sight in 2020.”
“I do not expect, by any means, a similar fall in sight in 2020. By the alternation rule I consider that, in the worst case, we would see a correction between 38.20 and 50% of the last upward stretch from the October step, “says Joan Cabrero, technical analyst and Ecotrader advisor . That would suppose to attend a fall towards 8,000 / 8,180 points and in the worst case until the reviewed 7,700 points .
“A drop to those levels would be a real Christmas gift,” explains Cabrero. That is to say, an effort that could well deserve the delivery of a gold medal to those who hold out at those prices to buy, since the overbought accumulated over the last bullish months would have been reliably eliminated.
And it is that, the reward if these levels are reached is capital considering the objectives that are managed from Ecotrader for the Ibex 35 . And it is that the selective Spanish would have in its most immediate point of view the 10,100 points , levels at which the index was quoted before the hit of the Covid-19 in March 2020 and that are more than 15% away from the closing levels this Friday.
In contrast, in the case of the Ibex 35, the risk up to these supports is between 1.5% and 7.2% (depending on the depth of the correction).
Tourism and banking pending
For this reason, in this context that the main stock exchanges in Europe have been raising in recent weeks, it is necessary to know how to choose the best candidates to incorporate into their investment portfolio. And within the Ibex 35 there are 15 companies that stand out for their technical aspect and for already trading at levels where they could be awarded the silver medal (see graph).
Among all of them, the values related in one way or another to the tourism sector stand out, such as IAG, Meliá, Amadeus or Aena . “The vast majority of them are already trading at very attractive levels, deserving of that silver medal,” says Cabrero.
“However”, continues the expert, “a deepening of the falls in the coming weeks would leave these values in an irreplaceable zone for those investors who want to buy and increase their exposure to the equity market”.
The incidence of the Delta variant in the Old Continent is delaying the recovery estimates for a sector that has postponed (once again) its reconstruction, also in the parks. In fact, analysts now believe that it will not be until the fourth quarter of the year when the six largest European airlines – IAG, Air France-KLM, Lufthansa, Ryanair, easyJet and Wizz Air – will get 70% of the revenue they had in the year 2019, just before the pandemic broke out.
That is why it is important to keep an eye on the results that these companies will obtain in the second quarter of the year and another at levels such as 1.50 / 1.58 for IAG , whose scope “would mean having developed a 50% correction of everything the upward movement that the value experienced in its rise from the October lows of 1 euro, to 2.57 euros, and all this in a value that has the capacity to go to 2.70 / 3 euros , that is to say, that it offers a potential reward that doubles or triples the risk that can be run by making an investment in it at these prices “.
Alejandro Sanz, Spanish star at the opening gala of the Tokyo 2020 Olympic Games
Nor should we lose sight of the Spanish banking sector. Bankinter, Santander, CaixaBank, Sabadell and BBVA are in a similar situation, trading at levels worthy of a silver medal and with the possibility of accessing the gold metal if they continue their declines.
“These reductions are what we have been insisting that we must take advantage of yes or yes to face a final stretch of the year that will surely be bullish,” says Cabrero while stressing that Banco Santander has already reached the support zone of 2.92 euros during some moments of this month and that from that environment or, in the worst case, the 2.74 euros (gold medal), he understands that he will resume the hikes in search of targets at 3.80 euros, which is where he traded before the Covid-crash . And the same happens with BBVA , which is the bank that is the strongest among the Spanish listed.
All this in a climate of contained euphoria after the approval this Friday by the European Central Bank of the total lifting of the restrictions on the distribution of dividends by banking entities that it imposed more than a year ago as a measure to conserve the maximum possible capital of the banking to face the consequences of the Covid-19 crisis .
Acciona, Repsol, Inditex …
In addition to these, investment opportunities can also be found among the largest selective firms such as Inditex, Iberdrola, Cellnex, Repsol, ArcelorMittal or Acciona , which complete the list of values that can reach optimal purchase levels if the consolidation of the Ibex deepens 35 .
In the case of Inditex , in fact, the Galician textile giant can be included as one of those companies that comply with the double-digit rule . This method consists of identifying those titles that have corrected at least 10% (double digit) since their last maximum and then, to continue with the screening, the ideal is to choose those that before that correction would have presented greater strength.
The Spanish textile is in that situation and “an adjustment to 25.5 euros in the worst case scenario would be an unbeatable opportunity to get on that upward trend in search of targets at 33.35 euros , which are the historical highs. that the title marked the year 2017 “, sentence Cabrero.
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