Peru LIMA IGRA index has one of the weakest chart set-ups in the emerging market equities. Multi-year head and shoulder top has a neckline standing at 14,150 levels. Index is trading at 13,493 levels – below the multi-year support. Decisive “weekly” close below 13,360 levels (minor low in January) will confirm the downtrend towards 10,000 levels. Strong medium/long-term resistance area remains between 14,150 and 15,000. Technical outlook is negative for Peru equities.
Peru’s IGRA index has been one of the weakest from the emerging market equities. After testing 23,850 levels for the third time in the beginning of 2012 IGRA index fell to 14,600 levels. Index formed a clear downtrend below its long-term moving average. Over the past year rebounds have been weak. Index is now testing the horizontal support at 14,600 levels for the third time. Breakdown below 14,600 will be negative for Peru’s IGRA index. Unless the index reverses above the 200-day moving average at 16,150, downward pressure will remain intact.
Similarly, cross rate against the U.S. dollar is challenging the resistance level at 2.82. 200-day moving average is forming support at 2.77. Peruvian Nuevo Sol remains in a downtrend against the U.S. dollar and unless USD/PEN reverses below 2.77 levels outlook will remain negative for the local currency.
