Merck is close to an area that might stop the downward trend.

The group beat the analysts consensus for its 2Q 2013 and confirmed its annual targets. The EBITDA increased by 10.7%, thanks to a a strong demand for 3D screens and large size television set. Thus, the Thomson Reuters analysts consensus have largely revised upward their EPS estimates for this year.

From a technical viewpoint, the trend is neutral in the short term. The security is trading between EUR 116 and EUR 127. The latest downtrend pushed the security upon contact with the lower limit of a bullish channel. This support, combined with the 20-week moving average, could stop the bearish trend of these last days.

Ideally, investors will take a long position nearby the 100-day moving average, in order to benefit from a technical rebound. The EUR 127 is the first goal. This strategy should be covered by a stop loss placed above the EUR 116 short term support because a breakdown of this level would invalidate it.