Argentina’s MERVAL Slides as Technical Weakness and Local Uncertainty Drive Sellers

The S&P MERVAL Index closed Monday’s session at 2,127,156, dropping 2.77% as technical signals and persistent local risks pushed sellers to the forefront.

Data from the Buenos Aires Stock Exchange and official trading charts confirm a sharp decline, with the market now well below its 50-day and 200-day simple moving averages, both key benchmarks for trend-following investors.

The 4-hour and 1-day charts show a clear pattern of lower highs and lower lows, underlining a sustained downtrend over the last several weeks. Technical indicators paint a consistent picture of weakness.

The Relative Strength Index (RSI) stands at 41.99 on the daily chart and 38.53 on the 4-hour chart, both levels indicating neither oversold nor any imminent reversal.

The Moving Average Convergence Divergence (MACD) remains negative across both timeframes, with the histogram showing no sign of bullish momentum.

Bollinger Bands confirm that price action is pressing the lower band, a classic sign of persistent selling pressure. All major moving averages—short and long term—signal a strong sell, with the index trading below the 5, 20, 50, 100, and 200-period averages.

Volumes remained steady but did not spike, suggesting that institutional investors are not stepping in to buy the dip. The Global X MSCI Argentina ETF (ARGT) mirrored local weakness, closing down 1.53% and reflecting subdued foreign appetite for Argentine equities.

This contrasts with global peers, where major indices in the United States and Europe posted modest gains as geopolitical fears eased, highlighting Argentina’s idiosyncratic risk profile.

Winners were scarce in this environment. Grimoldi led the gainers, jumping 8.4% on modest volume, followed by Domec SA up 4.85%, and Longvie up 3.11%.

These moves appear isolated and driven by company-specific news rather than broad sector strength. Laboratorios Richmond and Transener rounded out the top five, gaining 2.11% and 0.58%, respectively.

Losers dominated the session. The banking and utilities sectors suffered the steepest declines, with some stocks dropping more than 10% in a single day.

MarketScreener data confirms that several banks and utilities posted double-digit percentage losses, reflecting investor caution toward rate-sensitive and regulated sectors.

Benchmarking the MERVAL against regional peers, the Argentine market underperformed, with Brazil’s Bovespa and Chile’s IPSA both closing flat to slightly higher.

This divergence underscores the impact of domestic uncertainty, including ongoing inflation concerns and political transition, which continue to weigh on sentiment.

The technical outlook remains negative. The MACD and RSI on both 4-hour and daily charts show no sign of a reversal, while the price remains below all major moving averages.

Support at 2,063,233 is now in focus. If this level breaks, further downside is likely, with little evidence of buying interest at current prices.

Argentina’s equity market faces a challenging environment, with technical and fundamental signals pointing to continued caution. Investors await clearer signs of stabilization before returning in force.