European stocks wobbled Wednesday ahead of a Federal Reserve policy statement and the European Central Bank's Governing Council meeting.
But on Tuesday, European stocks moved higher as investors attempted to shrug off continued drama surrounding a potential debt default in Greece. And the bounce had one technician calling for a bottom.
"The selling in Europe can only be classified as "Grex-haustive," technical analyst Rich Ross joked Tuesday on CNBC's "Power Lunch. " "But I think it has created a compelling technical set up, which makes me want to be a buyer of Europe here."
In particular, Ross noticed some promising technical patterns forming on the chart of the Wisdom Tree Europe Hedged Equity Fund, an ETF that gives investors exposure to European equities while removing currency exposure. "The first feature of this chart is the head and shoulders bottom from which we emerged from back in January when we got the announcement of European QE," said Ross, head of technical analysis at Evercore ISI. "We surged 23 percent upon breaking out from that bottom."
Since the surge, shares of the ETF, which trades under ticker symbol HEDJ, have fallen 8 percent from the 52-week high hit in mid-April. "We've pulled back to critical support at the 150-day moving average, and it's created a textbook buying opportunity," Ross added. "I think you want to be a buyer of Europe down here as we could retest the old highs and rally as much as 11 percent."
The fundamental backdrop for Europe supports the technical setup for strong buying opportunity, said analyst Erin Gibbs.
"I would actually like to see it drop about 50 more points to get it closer to about 15 times forward earnings. And that's really where I see the sweet spot," said Gibbs, equity chief investment officer at S&P Capital IQ. "If we see continued concerns over Greece in the next couple of weeks, that's going to provide a real buying opportunity for investors."
Added Gibbs, "I see this as a long-term, good story."
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