A Former Renewable Energy Sector Star Could Be Staging a Comeback
European stock markets continue to trade near their highs. The sharp correction that hit technology stocks in the United States in recent days has had virtually no impact on European markets, which continue to show remarkable stability. In the wake of the U.S. midterm elections, stocks in the renewable energy sector have also begun to rally. As a result, the Danish energy company Oersted, one of the world’s leading renewable energy producers—particularly in the field of offshore wind power—has made it onto our weekly list. A longer-term turnaround in the stock’s price may be taking shape, while the technical picture suggests an upside opportunity with a particularly favorable risk-reward ratio. If this potential trend reversal is successfully confirmed, significant upside potential could open up in the coming period.
Hungarian Equities - Technical Analysis
The BUX index has rebounded to a level where, if the right conditions are met, a favorable shorting opportunity could arise again. MOL’s share price continues to follow a downward trend, and until this trend is broken, a sustained, trend-following rally is unlikely. Richter is moving within an ascending triangle pattern and is currently near its lower leg. If it forms a higher low, this could support the possibility of building additional long positions. Magyar Telekom has been in an uptrend for a month now, and there are no clear signs of a top yet. Opus continues to trade in a downtrend; no technical signals indicating a reversal have emerged yet. Rába continued its narrowing range and is getting closer and closer to the point where it is expected to break out of the pattern.
The dollar entered a corrective phase, but the euro also showed weakness during the week, meaning that the EUR/USD exchange rate has so far managed only to consolidate sideways. The dollar has entered a correction phase, but the euro has also shown weakness this week, so the EUR/USD exchange rate has so far only been able to correct within a sideways range. However, the pound has strengthened against the dollar, which means there may still be room for an uptrend within the broad range. The forint remained strong against its major counterparts. Against the euro, it may trade within a narrower range. Against the dollar, however, it reached its first target level, below which it began to consolidate. The USD/JPY exchange rate closed above its downtrend line, but still shows no signs of strength. The EUR/CHF, in a strong retest, broke below the key support level—which is not a good sign, as it should have bounced off that key level.
EURUSD
EURUSD
The exchange rate is in a correction phase, but it is still far from a structural shift. It was extremely oversold below 1.1230, so a correction phase was to be expected. There is still room for the correction to move higher, as the 1.1475 area is considered strong resistance. Based on the current pattern, a correction beyond this level cannot be anticipated. A structural shift is still a long way off; this would require a lower low, as well as a return to the important pivot level at 1.1719. Since the euro has not taken the initiative either, only a mild correction is on the horizon.
The reversal from the 1.3184 level has paved the way for another uptrend. The exchange rate broke through the downtrend at the 1.3306 level, which has now become a support level. Resistance is found at the previous swing highs, which extend to the natural level of 1.3672.
Resistance levels: 1.3672; 1.3916; 1.4160. Support levels: 1.3184; 1.2939; 1.2812.
EURHUF
EURHUF
The price has been trading in a range for weeks; there is a resistance zone above 367, while support can be found below 359 in the short term. It is still far from the descending thick red trendline, so the sideways movement could persist at these levels for quite some time. On the downside, the zone between 351 and 355 would provide very strong support, while on the upside, the 375 level represents strong resistance. Price action is likely to remain within this range in the coming weeks. It’s worth trading at overbought and oversold levels.
The price is consolidating below the key resistance level of 328.1. If the price closes above this level, it could reach 336 and 343.75. It may soon reach the rising trendline from above, which could either push the price higher or break the uptrend, causing it to fall again. A close below 320.4 could be a bad sign.
The strong retest closed above the downtrend line. Nevertheless, it remained below 159.4, which is the level it would need to close above to open up a gap. A break below the thick green trend line would be needed to trigger a short position and the start of a downward wave, but that is not yet the case.
Resistance levels: 162.5; 165.63; 168.75. Support levels: 153.13; 151.56; 150.
EURCHF
EURCHF
It even fell below the 0.9277 level, but given the sharp declines, buying interest emerged below that level as well. However, a buy could be considered only if the downward-sloping red trendline were to be broken.
Resistance levels: 0.9521; 0.9644; 0.9766. Support levels: 0.9155; 0.9033; 0.8911.
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