Ibex 35: Sideways Between 11,200 and 11,800, Volatility at 27

Sell in May 2015: Ibex Stalls Between 11,200 and 11,800

May 2015. The Ibex 35 enters the month with the old Anglo-Saxon adage in mind – sell in May and go away – and an index refusing to pick a side. The benchmark is trading in a range of 11,200 to 11,800 points, with volatility spiking to 27 mid-week and closing later at 23. Those expecting a clean sell-off were left staring at the screen, unsure what to do.

Why Did the Ibex Stay Sideways Between 11,200 and 11,800?

After a significant rally and subsequent correction, it's common for the market to move sideways. This isn't indecision; it's the phase where major players decide their next move. Technical resistance is at 11,680 points, with references pointing to 11,166 as a critical zone. Below that, support doesn't appear until 11,050.

The puzzling data point: the German ZEW index hit its worst reading in five months, yet the DAX rose 2% that same day. Market movements are indeed inscrutable, but when poor data coincides with a rally, someone is buying with information you don't have.

Volatility Hits 27, Halting the Decline

On Tuesday and Wednesday, volatility reached 27, cutting short the bearish trend. The next range was 27-54, but the closing figure remained at 23. The daily chart shows a reversal without testing the outer band, a failure that would have allowed volatility to exceed 27 and sustain the downward movement. The bear is dead, at least for a few days.

Some argue the rebound isn't alarming as long as it stays below 11,680, while others calculate that the month is still long and a significant fall is imminent. Both scenarios fit the current chart.

ACS, Sacyr, and Bankia: The Imbalanced Books

While the index meandered, the construction companies' financials were embarrassing. ACS divested at a loss: the average investment price was €6.7 per share, with an initial outlay around €11.5 billion, plus interest paid to banks and forced sales to cover guarantees when the value dropped below €4. Sacyr struggled to break €4.20 on meager volume. And Goldman Sachs published a report valuing Bankia's shares at €1.05.

One might say there's no way out. The uncomfortable question is how much of this deterioration was already priced in and how much is yet to come.

Gowex, Guanesas, and Coal: Scars from the First Wave

Here lies an anecdote that paints a picture of a generation of small investors. Some entered a company at €6.8 per share, “for my children,” and ran away with two or three hundred euros in losses. Others held shares bought at €7, watching them plummet to almost one euro, trusting projections that promised sevenfold returns. Someone cashed out €50 when the stock was burning through its value at over €6. The pattern repeats: those who sold on time boast, those who held on glance nervously at the chart.

As if that weren't enough, in London, housing asking prices rose 17% in three weeks after the British elections. The only asset surging with vigor.

Trolling as the Dominant Genre

With the index flat, noise overshadowed analysis. Mocking messages, accusations of duplicate accounts, and precisely dated predictions – gap down on Monday, touch 11,050, rise to 12,000 – filled the space previously occupied by charts. The most frequent complaint wasn't about the stock market: it was that before, with the same losses, at least you could have a laugh. Even trolling has degraded.

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With the Ibex stuck between 11,200 and 11,800, the unanswered question is whether this sideways movement is a floor or a pause before the next step. The Greek ghost still lingers, the 11,500 gap will remain open on Monday, and the only consensus is that May is a long month. Long for those watching the screen, not for those who have already cashed out.