But below we can see a rather important level in the IBEX which will prove pivotal over the next 6-9 months
|IBEX, daily. Thomson Reuters|
Next we can see the IBEX vs. the Spanish 10 year benchmark and for obvious reasons they would correlate highly - but what we've seen is the two diverge with Spanish debt relatively outperform Equity and so we have an opportunity here to hedge our potential long IBEX trade which would be short ES 10 futures / cash.
With the 10's standing at 4.48% we could potentially see this underperform Equity in the coming months as we see the two lines converge.
So our set-up is as follows, buy the IBEX on a daily close above 8,800 and simultaneously short Spanish 10 year debt. As we are not quite at this stage we have to follow but it may be reasonably close.