Indices Updates by Solid ECN

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The shares of Caterpillar Inc., the world's leading manufacturer of construction and mining equipment, are trading in a corrective trend around 217.

On the daily chart of the asset, a global Expanding formation pattern is forming, within which the price is in the stage of developing another wave of decline, with the target located at the low of the year 179.

On the four-hour chart, a downward wave is formed within a local channel with dynamic boundaries at 193 – 213. Since it is the fourth in a row, according to the classical scenario of the development of a price pattern, the probability of its complete completion is very high, which is also confirmed by the indicators: fast EMAs on the Alligator indicator are below the signal line, and the AO oscillator histogram forms bars in the sell zone.

 

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The shares of Pfizer Inc., one of the world's largest pharmaceutical companies, are correcting slightly above 53.

An uptrend is forming on the daily chart of the asset, and the price is holding above the support line at 49, developing a local increase.

On the four-hour chart, it can be seen that the channel with dynamic boundaries 49–57 is quite stable, and the price is approaching the resistance line, which is the main goal of the current upward movement of quotes. Since the price is in the middle of the channel, a downward scenario with reaching the support line at 49 is not excluded.

Technical indicators keep a stable buy signal, which is a priority: fast EMAs on the alligator indicator are above the signal line, and the AO oscillator histogram is trading in the buy zone, forming upward bars.

 

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The Dow Jones index is correcting in an uptrend at 33113.5. The American stock market continues to trade with serious volatility caused by increased activity of investors and their reaction to the fundamental background.

The day before, the Head of the White House, Joe Biden, held a meeting with US Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen, following which he stated that he did not intend to interfere in the regulatory process and fully supported the plan of the American financial authorities to combat record inflation. Investors took this statement as a clear "hawkish" signal, confirming the words of US Federal Reserve Board member Christopher Waller, who did not rule out a 50 basis point increase in interest rates at each of the subsequent meetings. Thus, the value by the end of the year may exceed 2.25%. The "hawkish" policy of the regulator is designed to fight inflation; however, the rapid pace of adjustment of monetary policy parameters may have a negative impact on corporate profits, which the American business may feel in the summer, when the second period of corporate reporting begins.

Quotes of the index are traded within a wide downward channel, being in the middle of the range. Technical indicators are holding a sell signal, which is rapidly weakening: the fluctuation range of the Alligator indicator EMAs has narrowed almost completely, and the histogram of the AO oscillator is forming new upward bars, being in the sell zone.

Support levels: 32550, 31217 | Resistance levels: 33290, 34950​

 

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The shares of Amazon.com Inc., the world's largest e-commerce platform, show a moderate sideways correction, hovering around 2432. A global downtrend is forming on the daily chart of the asset, and after an unsuccessful attempt to break the year's low of 2027, the price reversed and began a local upward correction. On the 4-hour chart of the asset, after the reversal, the instrument has consolidated above the initial 23.6% Fibonacci retracement around 2347, and the next barrier to growth may be the 38.2% Fibonacci base retracement around 2550.

The readings of technical indicators also confirm the high probability of continuation of the corrective upward dynamics: indicator Alligator's EMA oscillation range began to actively narrow towards growth, and the histogram of the AO oscillator forms ascending bars in the sell zone.

 

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Against the backdrop of the upward dynamics of the US dollar, the AUDUSD pair is correcting around 0.7190, despite the multidirectional reaction of investors to the incoming macroeconomic statistics.

Yesterday, Australia's Q1 GDP was published, and the indicator's growth slowed down to 0.8% from 3.6% QoQ but still was higher than the experts' forecast of 0.5%, which was taken into account by the participants trading in quotes. The value consolidates around 3.3% YoY, which is better than the preliminary market estimates of 2.9% but inferior to 4.4% in the previous quarter. Given the significant rise in fuel and food prices, we can say that the Australian economy is in a stable state. It is reflected in retail sales, which rose by 0.9%, in line with forecasts.

The American currency showed an active decline all last week, but now, the quotes have won back the losses and reached 102.500 in the USD Index against the backdrop of a positive report from the Institute of Supply Management (ISM), which said that Manufacturing PMI rose to 56.1 points from the April value of 55.4 points, surpassing analysts' expectations of 54.5 points. Meanwhile, according to JOLTS, the number of open vacancies in the labor market expectedly decreased and amounted to 11.400M for April, which is slightly inferior to 11.855M.

On the global chart, the asset moves within the Expanding formation pattern, rising within the fifth wave. Technical indicators reversed and gave a new buy signal: fast EMAs on the Alligator indicator crossed the signal line upwards, and the AO oscillator histogram formes upward bars in the buy zone.

Resistance levels: 0.7258, 0.7573 | Support levels: 0.7045, 0.6851​

 

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FTSE 100 shows local corrective dynamics, trading at around 7546.5 against the background of another increase in retail prices in the United Kingdom. Inflation was 2.8% this month, up from 2.7% in April, reflecting the strongest growth since 2011, according to data from the British Retail Consortium (BRC).

In turn, in the corporate segment, Tullow Oil Plc., an oil and gas exploration company, announced an imminent merger with another local industrial concern, Capricorn Energy Plc., which will increase the total value of the joint venture to 1.42 billion pounds. Shoe maker Dr. Martens Plc., which reported a 300% increase in pre-tax profit and a 17.5% increase in revenue in fiscal 2022, was the growth leader in the FTSE 100 index.

The index quotes are traded within the framework of the global Triangle pattern, being in the area of the resistance line. Technical indicators are holding a buy signal that remains fairly stable: the range of EMA fluctuations on the Alligator indicator is directed upwards and the AO oscillator histogram is trading in the purchases area, forming multidirectional bars.

Support levels: 7410, 7185 | Resistance levels: 7656, 7800

 

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The shares of eBay Inc., the world's largest online auction, are correcting upwards around the level of 47.

On the daily chart, the price is falling within a narrow downwards channel, approaching the resistance line. The key support remains a full correction of 61.8% Fibonacci 46, after its breakdown, the downward dynamics will intensify. On the four-hour chart, local growth may continue after consolidation above the local high of last week around 48.8. In this case, the movement target will be the 50.0% Fibonacci intermediate correction level at 53.3.

At the moment, fast EMAs on the Alligator indicator are approaching the signal line, and the AO oscillator histogram is forming upward bars in the sell zone.

 

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The development of the COVID-19 pandemic puts pressure on the position of the asset

The leading index of the Hong Kong Stock Exchange HK 50 is trading in a corrective trend, being close to 21,380.

The situation with the development of the COVID-19 pandemic continues to have a key impact on the country's economy. Over the past two weeks, the number of new cases of the disease has begun to seriously increase: at the end of May an average of 220 cases per day was recorded, but yesterday there were detected already 515 new cases. The Hong Kong authorities do not adhere to the "zero tolerance" policy, as in China, but have already warned citizens about the introduction of new restrictive measures.

The Hong Kong bond market is trading in almost complete correlation with other major markets and is rising, putting pressure on stock indices. The main 10-year bonds are trading at a yield of 2.782%, while the global 15-year bonds reach 2.991%. Short-term treasuries are also showing an increase: annual bonds reached the level of 1.451%, and two-year bonds are trading at a yield of 2.103%.

On the global chart of the asset, a local Triangle pattern is forming, within which the price has reached the resistance line and is preparing for a reversal. Technical indicators are still in a state of purchase: the histogram of the AO oscillator is trading above the zero level, and the fast EMAs on the Alligator indicator are above the signal line.

Support levels: 20,000, 18,100 | Resistance levels: 22,100, 25,100.​

 

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The shares of Johnson & Johnson, the world's largest maker of health products, are correcting, trading at 176.

On the daily chart, the price is within the global ascending channel with dynamic boundaries of 166 –1 87, reversing from the resistance line towards the support.

On a four-hour chart, the channel's support line coincides with the multi-year support level at 166, which the asset is aiming for. The key obstacle for the downside momentum is the low of last month at 173, after which the potential for further downside dynamics will increase. The indications of technical indicators also confirm the continuation of the decline: fast EMAs on the Alligator indicator crossed the signal line downwards, and the AO oscillator histogram fell into the sell zone, where it is now, forming new downwards bars.

 

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Global sideways correction in the shares of the American diversified corporation General Electric Co. strengthens, and quotes are traded around 78.

On the daily chart of the asset, a wide downward channel is forming with dynamic boundaries of 70 – 88, inside which the price reached the support line and formed a new low of the year around 71.

On the four-hour chart, the instrument starts forming a reversal formation, which so far looks like a local corridor. The prospect of upward dynamics and reaching the global resistance line at 87 is a priority, which is confirmed by the readings of technical indicators: fast EMAs on the Alligator indicator are actively approaching the signal line, narrowing the range of fluctuations, and the AO oscillator histogram is forming upward bars, almost reaching the transition level.

 

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Weak statistics put pressure on the stock market
DAX 30 is correcting upwards trading at 14592 ahead of what could be the most productive European Central Bank's (ECB) meeting in 8 years.

High annual inflation, recorded in April at around 7.5%, is forcing officials to move to tighten monetary policy, the first step towards which can be taken tomorrow. According to preliminary statements by the President of the regulator, Christine Lagarde, a complete cessation of the asset purchase program may be announced, and the question of raising the interest rate from –0.50% to a positive value may also be raised. The indicator was last updated in July 2011. According to Lagarde, these measures are necessary to curb the rapid growth in consumer prices, which could exceed the 9% barrier as early as June.

In turn, macroeconomic statistics remain negative, putting pressure on the stock market. According to data for April, the volume of Factory Orders in Germany decreased by 2.7% against an expected increase of 0.3%, and the Construction PMI fell to 45.4 points from 46.0 points a month earlier.

On the global chart of the asset, the price continues to implement the local Flag pattern, gradually moving away from the resistance line. Technical indicators maintain a steady buy signal: fast EMAs on the Alligator indicator are actively moving away from the signal line, expanding the range of fluctuations, and the AO oscillator histogram, having moved into the buy zone, forms ascending bars.

Support levels: 14350, 13540 | Resistance levels: 14836, 15710​

 

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The shares of ExxonMobil Corp., one of the largest oil companies in the world, grew due to rising energy prices and are now trading near the level of 104.

An uptrend is forming on the daily chart of the asset, within which the rate renews global highs. The price has now broken the 100.0% underlying trend level of Fibonacci extension at 99.

On the 4-hour chart, it is seen that the global growth will continue soon, and the trading instrument will try to reach the full trend of 161.8% of the Fibonacci extension around 114. This scenario is supported by the readings of technical indicators: fast EMAs on the Alligator indicator expand the range of fluctuations, and the AO oscillator histogram forms rising bars high in the buying zone.

 

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The Nasdaq 100 index shows a lateral trend, trading at 12590.​

US stock indices continue to experience significant pressure from the growth of bond yields, but are kept in the sideways amid investors' expectations regarding tomorrow's publication of data on consumer prices. Inflation in May could reach 0.7% after rising by 0.3%, while the annual rate, according to preliminary estimates, could remain at 8.3% in April, which, however, is unlikely given the monthly increase in fuel prices by almost 12% and the growth of oil prices above 122 dollars per barrel. In any case, until the actual data is published, new large transactions should not be expected.

Yesterday's auction for placement of 10-year Treasury notes ended with the expected growth of yield up to 3.030% against 2.943% at the previous placement. Today, auctions will be held for the placement of short-term treasury bills from 3 to 8 weeks, as well as global 30-year treasury bonds, the rate of return on which is now 3.183% against 2.997% before.

Index quotes form a global downward channel, being in the middle of the range. Technical indicators are in a state of uncertainty: the range of EMA fluctuations on the Alligator indicator is narrowing actively and the AO oscillator histogram is near the transition level.

Support levels: 12200, 11470 | Resistance levels: 12895, 14200​

 

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The shares of PayPal, correct at the level of 84.​

On the daily chart of the asset, the price left the wide downwards channel with the dynamic boundaries of 50 – 84, having broken the resistance line, and consolidated higher, around the local maximum of May 4 around 92.

On the four-hour chart, the instrument continues its growth attempts and is ready to break this high. While an upside scenario is a priority, a decline to the initial 61.8% trend level of the Fibonacci extension at 60 cannot be ruled out either.

Technical indicators confirm the high probability of the continuation of the current wave of corrective growth: fast EMAs on the Alligator indicator are above the signal line, and the AO oscillator histogram remains in the buying zone, forming rising bars.

 

[SOLIDECN]

A downtrend is forming on the daily chart of the asset, which may continue with renewed vigor if the price breaks the global year’s low of 373.

On a four-hour chart, the trading instrument failed to overcome the resistance line of the global downtrend at 440 and, having reversed, is actively declining. Despite the recent upward correction, the current momentum began with a price gap, one of the key markers reflecting its strength.

Technical indicators reflect a possible reversal: indicator Alligator’s EMA oscillation range began to actively narrow, and the histogram of the AO oscillator formed the first down bar in the buy zone.

 

[SOLIDECN]

On the daily chart of the asset, the price, having left the limits of the global downward channel with the boundaries of 148 – 176, has broken the support line and completed the formation of a reverse test, which may signal a further continuation of the global decline to the basic trend of 100.0% on the Fibonacci expansion around 105.

On the four-hour chart, the trading instrument has broken the current local low at 132, which is the last necessary condition for continuing the downward dynamics of quotations. The nearest support for the price is the initial 61.8% Fibonacci extension trend at 122.

At the moment, indicator Alligator’s EMA oscillation range expands downwards, and the histogram of the AO oscillator forms downward bars in the sell zone.

 

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The CAC 40 index is correcting at 6089. The French stock market continues to trade in a local downtrend against the background of the rapid growth of bonds, as well as in anticipation of another increase in domestic inflation.

Tomorrow France will publish data on inflation, which, as analysts suggest, will reflect an increase in the monthly rate of at least 0.7%, which, in turn, will lead to maintaining the annual rate at 5.8%.

The quotes of the asset continue to trade within the global downtrend, falling to the lowest level of the year. Technical indicators are in a sell signal state: the range of EMA fluctuations on the Alligator indicator is expanding towards the decline, and the AO oscillator histogram is trading in the negative area forming descending bars.

Support levels: 5881, 5610 | Resistance levels: 6250, 6569​

 

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ASX 200, the Australian bond market is actively growing​

The Australian stock market is under pressure from the upward trend in bond yields and a 4.5% decline in the consumer sentiment index, according to today's report by Westpac Banking Corp. So, the popular 10-year government securities of Australia reached the maximum of 2013 at around 4,207%, causing a drop in the investment attractiveness of risky assets for investors. For one-year bonds, the indicator significantly exceeded the yield of bank deposits and shares of companies from the most conservative sectors, amounting to 2.836%, and for global 20-year bonds – 4.406%, exceeding 3.850% at the beginning of last week.

The price of the index is within the global Expanding Formation pattern and is approaching the support line. Technical indicators reversed and gave a signal for the start of sales: the fast EMAs of the alligator indicator are well below the signal line, and the histogram of the AO oscillator forms descending bars while in the sales zone.

Support levels: 6565, 6300 | Resistance levels: 6710, 7120​

 

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Tesla, technical analysis​

On the daily chart, the price is within the global Expanding formation pattern, gradually approaching the support line around 550. At the moment, the formation of the fifth downward wave is observed, which has reached the basic trend of 100.0% of the Fibonacci extension around 628.
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On a four-hour chart, the local dynamics close within the Triangle pattern with dynamic boundaries of 746 – 628, the location of which confirms the further development of negative dynamics. Fast EMAs on the Alligator indicator continues to move away from the signal line, and the AO oscillator histogram forms bars with a downward trend in the sell zone.​

 

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Nasdaq 100, formation of a global descending channel​

One of the leading US indices, the Nasdaq 100, shows a downward trend, being at 11211. Due to the continued decline of stock markets, investors are increasingly paying attention to third-party markers that can describe and predict the future behavior of stocks. So, according to the Dow Jones Market Data report, for the first 100 days of this year, the combined dynamics of the leading US indices Dow Jones and S&P 500 was estimated by experts to be the weakest since 1970, and of the Nasdaq 100 technology index – even in the entire history of observations. Among the main reasons are high inflation and the insufficiently transparent policy of the US Fed regarding the regulation of interest rates.

As for global dynamics, the Buffett indicator, popular among bidders, reached 205%, which points out a significant revaluation of the stock market relative to the current state of the economy and hints at a possible continuation of the collapse in prices. The Wilshire 5000 Total Market composite stock market capitalization index was 46.69T dollars, and the latest GDP data was 22.72T dollars, which corresponds to 205% in terms of the coefficient, reflecting the highest value in history, whereas before the 2008 crisis it was about 150%.

The index quotes continue to form a global descending channel, declining in the direction of the support line. Technical indicators are in the state of a sell signal: the range of fluctuations of the EMAs of the alligator indicator is expanding in the direction of decline, and the histogram of the AO oscillator is trading in the sales zone.

Support levels: 11000, 10000 | Resistance levels: 11730, 12950​