Swiss Telecom Giant Could Defy Negative Market Sentiment
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Hungarian Equities - Technical Analysis
Primarily driven by the strong performance of MOL, the index advanced to a new all-time high, which may postpone the formation of a potential reversal pattern. For a meaningful short setup to emerge, the long-term ascending trendline would also need to be breached. Following the dividend payment, MOL shares could retrace toward the 5,000 level; however, the major support zones and the long-term uptrend are located considerably lower. Richter once again found support around 12,500 and has not yet broken its rising trend. Magyar Telekom has stabilized above the 2,500 level, although risks have not disappeared entirely: should this support fail, the stock could enter another corrective phase. Opus remains in a downtrend, and there are currently no clear technical signals suggesting an imminent trend reversal. Following its previous sharp rally, Rába continues to trade in a consolidation phase. The stock could return to a favorable buying zone below 3,125, particularly if it approaches the 2,500 area.
The Dominoes Are Falling: A Sharp Market Correction May Be Ahead.
The major U.S. equity indices have remained in a corrective and consolidation phase for several weeks, while small-cap stocks are increasingly displaying signs of a developing downtrend. With this week's Federal Reserve interest rate decision approaching, it is hardly surprising that uncertainty surrounding the future path of monetary policy has weighed modestly on investor sentiment and equity markets in recent weeks. Should the key support levels now come under pressure and ultimately fail, the markets could be vulnerable to a more pronounced corrective move. Investors are expected to gain greater clarity following Wednesday's Fed announcement, which may provide fresh guidance for market direction in the months ahead. At present, however, high-quality bullish setups remain scarce, with only a limited number of stocks exhibiting the technical characteristics typically associated with sustainable upside potential.
The major European equity indices generated sell signals over the past week, and the broader market backdrop continues to deteriorate. In such an environment, momentum-based reversal setups tend to perform poorly. While it is always possible to identify stocks that meet quantitative screening criteria, additional technical factors often make them unsuitable investment candidates. Overall, this is not an ideal market environment for seeking long opportunities. Nevertheless, today's list includes one stock that continues to present a constructive technical picture. Swisscom AG, Switzerland's leading telecommunications and IT services provider, offers an attractive combination of defensive characteristics and a high dividend yield. The company provides mobile, broadband internet, television, and fixed-line services to retail customers, while also maintaining a significant presence in enterprise IT services, cloud computing, cybersecurity, and digital solutions.
Best rated European stocks based on momentum ranking
Compelling technical picture:
Swisscom (daily): The stock has recently turned higher and appears to have established a new upward trend. The 625 equivalent support zone proved to be a key level during the correction and successfully held, resulting in a significantly higher low. Over recent trading sessions, the stock has resumed a trend-like advance, suggesting that further upside potential remains. A minor resistance area can be found near 688, but the broader technical setup points to a potential advance toward the 750 region.
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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