Utilities dominate European stock markets too
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The technology sector is the winner in Europe as well
European markets have not reached new highs in recent weeks because only technology stocks are performing well; in other words, the bull market has not broadened to other sectors. Within the technology sector, software stocks—which had been lagging behind—gained momentum again this week and are beginning to rebound from a prolonged correction. We took a closer look at two stocks: one is SAP, a German multinational software company, and the other is Amadeus IT Group, which develops technology solutions for the travel and tourism industry.
Hungarian Equities - Technical Analysis
The correction phase may come to an end if several stocks break above their downward correction trend. For now, there are no patterns suggesting a sustained, trend-like decline for the index. MOL: Following the correction phase, the stock may attempt a turnaround. Richter: From the reversal pattern, it reached the 11,875 level, from which it bounced back; a new high could emerge if the downward trend is broken. Magyar Telekom: The healthiest upward trend is observable, and the stock still has room to move higher. Opus: An upward correction is visible, but it may encounter strong resistance around 437. Rába: There is also a chance for a stronger rise here.
On European stock exchanges, utility companies were also able to resist the selling pressure prevailing on the markets. Of course, many of them have already gone quite far, so in today's material, we found only one stock worth buying after backtesting.
Best rated European stocks based on momentum ranking
Compelling technical picture
Redeia Corporation (daily): The downward trend line broke a few days ago, giving a long signal above 15.63. If there is a retest, a favorable long entry could be found around the aforementioned level. The previous breakout level around 18 could be reached.
List of stocks with a chance of a turnaround in the coming weeks
Most popular European stocks
The momentum model supports the creation of a technical based stock list that helps to find shorter-term trading opportunities. The model can be used to identify stocks that show reversal signals following more sustained falls/underperformance. We examine one-year, six-month, three-month, one-month and five-day momentum values, which are used to rank the stocks under consideration. The higher a stock is ranked in the order, the better it technically performs relative to the others. The change in the ranking over time is used to determine the life cycle of the stock.
- In the first table, we collect the stocks that show the most attractive picture compared to the others in a given week based on momentum factors, of which those are also presented in a separate chart where a favourable situation can be identified based on additional technical analysis tools.
- In the second table, we list the stocks that are already worthy of being placed in watchlist status. They are not among the best performers, but they have the potential to improve and signal a turnaround in a few days or weeks.
- In the third table, we have also collected the more popular stocks to help identify their position in the momentum order.
The report shows the results of a technical - quantitative based stock screening, which does not examine the fundamental background/value of the companies. For this reason, risk management/position sizing rules should be designed accordingly.
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