These are the six jewels per technician within the Spanish Continuous Market

The Ibex Small Cap, which is the stock index that brings together the small-cap listed companies of the four Spanish stock markets, is attacking in the short term the highs of the year that it reached in the middle of last January at 8,630 points, which it is a horizontal resistance that has been holding back the rise since August of last year.

The rupture of this horizontal resistance would be a clear sign of strength by technical and would open the door to a context of an attempt to resume the upward trend that defines the Ibex Small Cap from the lows of March 2020, being the first objective to assess the zone of highs that the index reached last year, which they find each other 8-10% away of current levels, which is the same route that the Ibex Medium Cap has up to similar resistances.

This possible upward trend invites us to be very attentive to the possible opportunities that can be found among Spanish small and mid-cap companies, which in most cases present a much better risk-return equation than the one we can find in stocks and blue chip companies.

Within the Continuous Market these six companies call my attention today: Soltec, Grenergy, Tubos Reunidos, Duro Felguera, Técnicas Reunidas and NH Hoteles.

Soltec

The renewable energy company Soltec, specializing in the manufacture of solar trackers, being the number one manufacturer in Europe, was last week one step away from reaching the theoretical support of 4.70-4.80 euros, which would mean a 61.80/66% correction of all the last upward impulse that took it from 3.90 to 6.20 euros. The scope of this theoretical support of 4.70-4.80 euros or the overcoming of resistance at 4.15 euros would be a buying opportunity managing a partial stop below 4.29 euros and a total stop below 3.90 euros, I understand have been a floor in the downward trend of recent months, seeking a new upward momentum that in the coming months could seek targets at 8-8.30 euros, which are the highs of November last year and whose scope would mean a recovery of 38.20% of Fibonacci of all the fall from the highs of January 2021 in the 15 euros. We are talking about assuming a risk of around twenty percentage points to go for a minimum reward of 65%, this is a risk return equation of 3:1.

Grenergy

Another renewable energy company that I find technically very interesting is Grenergy (GRE.MC). On this occasion, I like the strength that the title presents after recovering 50% from the minimum it marked on February 22 in the area of ​​22 euros. In the short term, it is pressing the downward trend that arises from uniting the maximums of January, February and November 2021, which runs through the area of ​​33 euros. Everything indicates that it is a matter of time before it ends up surpassing it and if before that happens the price consolidates positions up to 27-28 euros, I would see it as a magnificent buying opportunity with a stop below 22 euros in search of initial rises towards 36, 40 and 45 euros. In this case, we are talking about assuming a risk of 20% to go looking for a potential profit of 65%, which would also give us an equation of 3:1.

Assembled Tubes

The Spanish industrial group Tubos Reunidos (TRG.MC), specialized in the production of seamless tubes, is another of the small and mid-cap companies that I see as very interesting from a technical point of view. For a year, the price has been consolidating positions in a movement that has served to correct the 61.80% Fibonacci of the entire rise that was born at the lows of March 2020, after reaching the area of ​​0.27 euros. From there it is trying to lay the foundations to resume its impeccable upward trend, something that would take shape if it manages to overcome resistance of 0.40 euros. Looking for this bullish hypothesis, which would open the door to increases towards at least last year’s highs of 0.54 euros, although the target to be valued in coming years is at 1.25 euros, it could be bought with a stop under the 0.27 euros, which are 25% away.

Rough Felguera

Duro Felguera (MDF.MC), which is one of the historic companies on the Spanish Continuous Market, has also been consolidating positions for months in a bearish lateral process that seems to have found a floor at 0.64-0.66 euros, from where it wants to resume its upward trend that was born at the lows of 2020, which was the bottom of the downward trend of the last decade, which began at the highs of 2013 around 30 euros. Only that it recovers 23.60% of that fall, something that would be completely normal technically, would mean seeing increases in the coming years towards 7 euros. In this case, the stop would place it below 0.64 euros, which would mean assuming a risk of 30%. If they do not assume it a priori, it is best to look for other options.

Gathered Techniques

With Técnicas Reunidas (TRE.MC) I am struck by the powerful upward turnaround pattern that is about to confirm the title if it manages to overcome resistance at 9 euros. This pattern would indicate that the 6.70 euros, reached at the end of February and which already served as a brake on the falls of August 2021 and March 2020, would be the probable bottom of the downward trend of the last seven years, which found a ceiling in the highs of 2015 around 42 euros. Exceeding 9 euros, the idea would be to seek first targets at last year’s highs at 13.90 euros, which are 55% away. The stop would place it below 7.45 euros, which would mean assuming a risk of 17%.

NH Hoteles

I have been pointing out for months that it is a matter of time before NH Hoteles (NHH.MC) ends up going to look for the 6.50 euro zone, which is where it was listed before the Covid crash. It strikes me that the last fall did not go below the low of last December at 2.80 euros, which reinforces my idea that this support has been the floor of the consolidation of recent months and the point of origin of a rise towards 5.15 and 6.50 euros. We are talking about a potential of 55 and 92% while the risk managing a stop below 2.80 euros would be 15%.