After a steep upmove in the first half of November, the Mediaset Espana Comunicacion SA (BME: TL5) stock started correcting lower, after hitting the 3.900 barrier on November 16th. The technical picture, which we can see on our daily chart right now, indicates there could be a possible bullish flag forming, meaning that the share price has a good chance of making its way up again. However, to get comfortable with that idea, we would prefer to wait for a violation of the upper side of the pattern and then a break above the 3.900 barrier. Until then, we will remain somewhat positive with the near-term outlook.
If, eventually, TL5 makes a move through the upper side of the above-discussed pattern and then climbs above the 3.900 barrier, marked by the current highest point of November, that may attract more buying interest. This could result in the stock accelerating further, possibly even overcoming the highest point of June, at 3.972, and targeting the 4.295 area, marked by the low of March 2nd. That’s where the share price might get halted for a bit, but if there is still some interest in TL5 at that price, this may lead to a further move north, possibly targeting the 4.526 level, marked by the low of February 24th and the high of March 3rd.
Despite the RSI and the MACD being slightly on the flat side, at the time of writing, the RSI still remains above 50 and the MACD continues to run above zero and its trigger line. This way the two oscillators continue to show positive price momentum, which may support the scenario discussed above.
Alternatively, if the share price moves lower and ends up sliding below the 3.412 hurdle, marked by the inside swing low of September 11th and the high of November 12th, that could increase the stock’s chances of drifting further south. New investors may stay away from entering any time soon and TL5 might fall to the 3.228 obstalce, or even to the 3.128 level, marked by the highs of October 6th and 23rd.
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