The trend is clearly bearish on Abengoa and it could soon reach its EUR 1.64 support.

The company is fragile. Financially, the group is in a difficult situation with a high leverage estimated at 7.38x for the last fiscal year and it is estimated at 7.20x for this year. Forecasts downgraded by analysts regarding earnings per share reflect the lack of visibility in the short term.

From a technical viewpoint, prices are in a downward trend on all time scales. Moving averages are trending down and put pressure on the stock, which confirms this downward momentum. This trend may continue toward the EUR 1.64 support.

Investors could take a short position at the current price to target the EUR 1.64 support. A stop loss is placed above the EUR 1.97 mid-term resistance, threshold that would invalidate the bearish strategy.