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Inditex (IDEXY) Trading at the Critical Support of 16.40

Last week, I proposed a bullish outlook for shares of Inditex (IDEXY) as it anchored above 16.40. However, by the end of the week, this support pivot and the bullish scenario were being threatened as price retreated back towards the 16.40 pivot.

Inditex Daily Chart 1/23

(click to enlarge)

- As we can see in the daily chart, IDEXY is already developing higher highs and higher lows throughout 2016. 
- The manner is very choppy, so I would not consider this a bullish market yet, but still part of the consolidation that started in 2015. 
- In fact the 18.75-80 area was the resistance in 2015, and IDEXY failed to push through in 2016, confirming the consolidation mode. 
- The market in the medium to long-term is therefore bullish-neutral. 

Critical Support:
- Within the bullish-neutral scenario 116.40 is a key support. 
- A break below breaks a rising trendline from Feb. 2016 as well as the support since Nov. 2016. 
- The break below 116.40 would be the market saying it is in a bearish mode within the larger consolidation context.
- This bearish  scenario opens up the 15.00 handle, although a long-term chartist would see some potential support just under 16.00 as well. 
- The weekly chart shows a 200-week SMA around 15.60 along with a rising trendline going back to 2009. 
- Now, if 16.40 holds and price can climb above 17.00, we would be looking at more of a bullish scenario that will have the 18.75-18.80 area in sight, with potential of breaking higher due to the prevailing uptrend seen in the weekly chart. 

Inditex Weekly Chart 

(click to enlarge)