The technical picture of the Spanish utility company Endesa SA (BME: ELE) shows that last week the share price overcame a medium-term downside resistance line drawn from the high of June 16th. At the same time, the stock is trading above a short-term tentative upside support line drawn from the low of October 1st. Although there are indications that a further move north could be possible, we would first prefer to wait for a break above last week’s high, at 20.45.
Such a break will confirm a forthcoming higher high. The stock could then travel to the 21.39 obstacle, marked by the highest point of September, where a temporary hold-up might occur. However, if the buying doesn’t stop there, the next potential target might be the 21.55 hurdle, or even the 22.08 level, marked by the low of June 28th.
The RSI and the MACD are both pointing higher. In addition to that, the RSI is still above 50 and the MACD continues to float above zero and the trigger line. The two indicators show positive price momentum, which supports the idea mentioned above.
Alternatively, if the share price falls below all the previously mentioned trendlines and also drops below the 19.04 hurdle, marked by the current lowest point of November, that may temporarily spook some buyers from the arena. ELE may then slide to the 18.53 obstacle, a break of which might set the stage for a move to the 17.79 level, which is the low of October 12th.
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