After doing a review of the analysis of Elecnor, study their current situation and identify important levels to take positions, remained pending for the next article reviewing the analysis of Inditex (ITX) held last April.
[Daily and weekly chart ITX.MC]
Article: Rebate with Inditex , a possible correction of the uptrend was noted that although there was was deeper than expected:
“Before going up you may witness a correction to one of the following levels :
- 47 € – closing the gap left open.
- € 45.5 – 50-day moving average (on daily chart we can see that it has been respecting all rise).
- 45 € – base of the bullish channel. “
He found support in the MM200 green – curve in graphic diary in the 42 €, which gives us an idea of the importance of playing this indicator.
Possible operational options also commented selling PUT 50 JUN 10 which in that case who would have followed had pocketed € 2,125 per share, closing at 49.085 ITX the 18/6 and assume a cost of € 46.96 the 24/4 to take the position, equivalent to a yield of 4.52% in 2 months.
What can we learn graphics now?
ITX continues to have an excellent bullish technical side, after breaking record highs and correct something more than expected has again set new highs.
Impeccable rise from 43.87 € at closing prices last 8/6 up to 53.32 € reached the 26/7 is a more than 21% in just over 1.5 months revaluation, which has been accelerated in last days.
The value is in free rise without resistance, but should exercise caution, because the “infinite” do not exist and increases the possibility of correction increases in step with the rise.
What could we do?
The trend is clearly upward therefore it is logical to think about continuity, but bearing in mind the strong recent rise could wait to get bought for a correction to levels that indicate Moving Averages (MM) 20, 50 or 200 sessions according to our patience and level of risk:
- MM20 now located in the vicinity of 49.50 € seems achievable in a technical correction.
- MM50 now located in the vicinity of 47.50 € has served as a fulcrum on numerous occasions on the rise from lows.
- MM200 now located in the vicinity of € 44.75 represents an important support, but hardly achievable in the short term if a sharp turn does not occur down markets.
For an added bonus, if we repeat the operation with the sale of put options, the closing price of 26/7 would be a rather meager premium, especially if we expect a correction value.
The following table shows premiums and equilibrium prices for different strike of the PUT set10:
The equilibrium price (strike – premium) represents the level from which the operation would take losses if ITX closed lower at maturity, which saw the resulting values pospondríamos operational options so far that we considered optimal for entering and equilibrium prices were at a point that we considered safe.
Warning: This article is not a recommendation to buy or sell securities and any related transaction involves risk of loss, which should not be done if you are not willing to assume.
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