Technical Analysis
EUR/JPY: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is crossing the price chart from below, current cloud is ascending. The instrument is trading between Tenkan-sen and Kijun-sen lines. One of the previous minimums of Chikou Span line is expected to be a support level (132.633). One of the previous maximums of Chikou Span line is expected to be a resistance level (133.271).
On the daily chart Tenkan-sen line is above Kijun-sen, the red line is directed upwards, while the blue one remains horizontal. Confirmative line Chikou Span is crossing the price chart from above, current cloud is ascending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (131.897). One of the previous maximums of Chikou Span line is expected to be a resistance level (133.787).
It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (136.031) line and Stop Loss at the level of Kijun-sen line (131.502).
SX5E: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is going to reverse from descending to ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (3958.6). One of the previous maximums of Chikou Span line is expected to be a resistance level (4048.2).
On the daily chart Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (3926.2). One of the previous maximums of Chikou Span line is expected to be a resistance level (4047.4).
On the four-hour chart we can see a correction of the upward movement. On the daily chart we can see a correction of the upward movement. It is recommended to open long positions at current price with the target at the level of previous maximum of Chikou Span line (4046.4) and Stop Loss at the upper border of the cloud (3975.7).
EOS: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the red line is directed upwards, while the blue one remains horizontal. Confirmative line Chikou Span is above the price chart, current cloud is descending. The instrument is trading between Tenkan-sen and Kijun-sen lines. One of the previous minimums of Chikou Span line is expected to be a support level (5.1647). One of the previous maximums of Chikou Span line is expected to be a resistance level (7.3582).
On the daily chart Tenkan-sen line is below Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is crossing the price chart from below, current cloud is ascending. The instrument has entered the cloud. One of the previous minimums of Chikou Span line is expected to be a support level (4.9091). One of the previous maximums of Chikou Span line is expected to be a resistance level (8.2938).
On the four-hour chart the instrument is still falling. On the daily chart we can see a correction of the downward movement. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (4.9352) and Stop Loss at the level of Kijun-sen line (7.1121).
EUR/GBP: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span has crossed the price chart from below, current cloud is going to reverse from descending to ascending. The instrument has entered the cloud. One of the previous minimums of Chikou Span line is expected to be a support level (0.8594). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.8663).
On the daily chart Tenkan-sen line is below Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is going to reverse from descending to ascending. The instrument has entered the cloud. One of the previous minimums of Chikou Span line is expected to be a support level (0.8551). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.8711).
On the four-hour chart we can see a correction of the downward movement. On the daily chart we can see a correction of the downward movement. It is not recommended to open positions at current price. Pending orders should be placed at the cloud’s borders: sell at the level of 0.8602, with Take Profit at 0.8525 and Stop Loss at 0.8630; buy at the level of 0.8630, with Take Profit at 0.8715 and Stop Loss at 0.8602.
GBP/NZD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the blue line is directed upwards, while the red one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.9683). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.9799).
On the daily chart Tenkan-sen line is above Kijun-sen, the red line is directed upwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is going to reverse from ascending to descending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.9643). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.9852).
On the four-hour chart we can see a correction of the upward movement. On the daily chart we can see a correction of the upward movement. It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (2.0081) line and Stop Loss at the level of Kijun-sen line (1.9604).
Brent Crude Oil: wave analysis
The price is in a correction, a fall is possible.
On the daily chart, the upward wave C forms, within which the first wave 1 of (1) of C develops. Now, the third wave of the lower level iii of 1 has formed, and a downward correction is developing as the fourth wave iv of 1, within which the wave (b) of iv has ended, and the formation of the wave (c) of iv has started. If the assumption is correct, the price will fall to the levels of 58.15–53.71. In this scenario, critical stop loss level is 70.20.
Main scenario
Short positions will become relevant during the correction, below the level of 70.20 with the targets at 58.15–53.71. Implementation period: 7 days and more.
Alternative scenario
The breakout and the consolidation of the price above the level of 70.20 will let the price grow to the levels of 75.00–80.00.
XAU/USD: wave analysis
The pair may grow.
On the daily chart, the third wave of the higher level (3) formed, a downward correction developed as the fourth wave (4), and the formation of the fifth wave (5) started. Now, the first wave of the lower level 1 of (5) has formed, and a local correction is starting to develop as the wave 2 of (5). If the assumption is correct, after the end of the correction, the pair will grow to the levels of 1958.98–2067.60. In this scenario, critical stop loss level is 1780.79.
Main scenario
Long positions will become relevant after the end of the correction, above the level of 1780.79 with the targets at 1958.98–2067.60. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 1780.79 will let the pair go down to the levels of 1727.45–1676.05.
Intel Corp.: wave analysis
The price is in a correction and may grow.
On the daily chart, a downward correction of the higher level developed as the second wave (2), within which the wave C of (2) formed, and the development of the third wave (3) started. Now, the first entry wave of the lower level i of 1 of (3) has formed, and a downward correction has developed as the wave ii of 1. If the assumption is correct, after the correction, the price will grow to the levels of 75.00–80.00. In this scenario, critical stop loss level is 53.14.
Main scenario
Long positions will become relevant during the correction, above the level of 53.14 with the targets at 75.00–80.00. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 53.14 will let the price go down to the levels of 45.49–43.53.
ATT Inc.: wave analysis
The price may grow.
On the daily chart, a downward correction of the higher level developed as the wave (2), within which the wave C of (2) ended, and the development of the third wave (3) started. Now, the first entry wave of the lower level 1 of (3) is forming, within which the wave iii of 1 has formed, and the wave iv of 1 has ended. If the assumption is correct, the price will grow to the levels of 34.50–37.00. In this scenario, critical stop loss level is 27.96.
Main scenario
Long positions will become relevant during the correction, above the level of 27.96 with the targets at 34.50–37.00. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 27.96 will let the price go down to the levels of 26.30–25.00.
AUD/JPY: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (83.94). The closest resistance level is Tenkan-sen line (84.38).
On the daily chart Tenkan-sen line is above Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is crossing the price chart from above, current cloud is ascending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (83.23). One of the previous maximums of Chikou Span line is expected to be a resistance level (85.08).
On the four-hour chart the instrument is still falling. On the daily chart we can see a correction of the upward movement. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (83.94) and Stop Loss at the level of Kijun-sen line (84.38).
CAD/CHF: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is crossing the price chart from above, current cloud has reversed from ascending to descending. The instrument has been corrected to the Tenkan-sen line. One of the previous minimums of Chikou Span line is expected to be a support level (0.7422). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.7461).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading between Tenkan-sen and Kijun-sen lines. The closest support level is Kijun-sen line (0.7386). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.7498).
On the four-hour chart we can see a correction of the upward movement. On the daily chart the Bullish trend is still strong. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (0.7422) and Stop Loss at the level of Kijun-sen line (0.7461).
EUR/NZD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the blue line is directed upwards, while the red one remains horizontal. Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Tenkan-sen line (1.6969). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.7035).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Kijun-sen line (1.6823). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.7185).
It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (1.7035) line and Stop Loss at the level of Kijun-sen line (1.6969).
EUR/AUD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Kijun-sen line (1.5703). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.6015).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Kijun-sen line (1.5602). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.6120).
It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (1.6015) line and Stop Loss at the level of Kijun-sen line (1.5703).
GBP/CAD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is ascending. The instrument is trading around upper border of the cloud. The closest support level is the upper border of the cloud (1.7003). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.7227).
On the daily chart Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.6854). The closest resistance level is Kijun-sen line (1.7250).
On the four-hour chart the instrument is still rising. On the daily chart the Bearish trend is still strong. It is recommended to open long positions at current price with the target at the level of previous maximum of Chikou Span line (1.7227) and Stop Loss at the upper border of the cloud (1.7003).
GBP/TRY: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Kijun-sen line (11.8081). One of the previous maximums of Chikou Span line is expected to be a resistance level (12.4855).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. The closest support level is Kijun-sen line (11.5683). One of the previous maximums of Chikou Span line is expected to be a resistance level (13.1274).
It is recommended to open long positions at current price with the target at the level of previous maximum of Chikou Span line (12.4855) and Stop Loss at the upper border of the cloud (11.8081).
WTI Crude Oil: wave analysis
The price may fall.
On the daily chart, a downward correction of the higher level developed as the wave B, and the upward wave C forms, within which the first wave 1 of (1) of C develops. Now, the third wave of the lower level iii of 1 has formed, and a local correction is developing as the wave iv of 1, within which the wave (b) of iv has ended, and the wave (c) of iv is developing. If the assumption is correct, the price will fall to the levels of 57.06–54.69. In this scenario, critical stop loss level is 66.82.
Main scenario
Short positions will become relevant during the correction, below the level of 66.82 with the targets at 57.06–54.69. Implementation period: 7 days and more.
Alternative scenario
The breakout and the consolidation of the price above the level of 66.82 will let the price grow to the levels of 75.00–80.00.
XAG/USD: wave analysis
The pair may fall.
On the daily chart, the first wave of the higher level (1) of 3 formed, and a downward correction develops as the wave (2) of 3, within which the wave C of (2) forms. Now, the first wave of the lower level i of C has formed, the correctional wave ii of C has ended, and the formation of the wave iii of C has started. If the assumption is correct, the price will fall to the levels of 22.68–20.49. In this scenario, critical stop loss level is 28.69.
Main scenario
Short positions will become relevant during the correction, below the level of 28.69 with the targets at 22.68–20.49. Implementation period: 7 days and more.
Alternative scenario
The breakout and consolidation above the level of 28.69 will let the price grow to the levels of 29.98–31.50.
Netflix Inc.: wave analysis
The price is in a correction, a fall is possible.
On the daily chart, the fifth wave of the higher level (5) develops, within which the wave 3 of (5) formed, and a local correction develops as the fourth wave 4 of (5). Now, the wave of the lower level c of 4 is forming, within which the wave (iii) of c is developing. If the assumption is correct, the price will fall to the levels of 450.95–412.59. In this scenario, critical stop loss level is 561.87.
Main scenario
Short positions will become relevant during the correction, below the level of 561.87 with the targets at 450.95–412.59. Implementation period: 7 days and more.
Alternative scenario
The breakout and the consolidation of the price above the level of 561.87 will let the price grow to the levels of 615.00–650.00.
Walt Disney Co.: wave analysis
The price may grow.
On the daily chart, a downward correction of the higher level developed as the fourth wave (4), and the fifth wave (5) develops. Now, the third wave of the lower level 3 of (5) has formed, and a downward correction has ended as the wave 4 of (5). If the assumption is correct, the price will grow to the levels of 202.98–220.00. In this scenario, critical stop loss level is 166.66.
Main scenario
Long positions will become relevant during the correction, above the level of 166.66 with the targets at 202.98–220.00. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 166.66 will let the price go down to the levels of 155.16–144.12.
USD/JPY: decline may continue
Current trend
Despite the signs of rising US inflation and investors' expectations about the imminent curtailment of the US Federal Reserve's emergency stimulus program, USD Index is still under pressure, trading at multi-month lows near the level of 90.000. The weakening of the US currency is seen as a key factor putting pressure on the USD/JPY pair.
The medium-term trend reversed downwards at the end of April when the target zone 108.55–108.32 was broken, after which the main targets of sellers moved to the range of 106.24–106.02 (target zone 2). Throughout May, the asset was correcting, testing the trend border 110.08–109.63 as part of the correction. The area has been held, as a result of which the price falls.
Now the "bears" are trying to break through the support level 108.71–108.53, in this case, a further fall to the level of 107.51 is possible. If support is held, then another test of the trend border will take place.
Support and resistance
Resistance levels: 109.63, 110.86.
Support levels: 108.53, 107.51.
Trading tips
Short positions may be opened below the level of 108.53 with the target at 107.51 and stop loss 108.87. Implementation period: 5–7 days.
Long positions may be opened above the level of 109.63 with the target at 110.86 and stop loss 109.03.
GBP/AUD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument is trading between Tenkan-sen and Kijun-sen lines. One of the previous minimums of Chikou Span line is expected to be a support level (1.8215). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.8294).
On the daily chart Tenkan-sen line is above Kijun-sen, both lines are directed upwards. Confirmative line Chikou Span is above the price chart, current cloud is going to reverse from descending to ascending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.8120). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.8418).
On the four-hour chart we can see a correction of the upward movement. On the daily chart we can see a correction of the upward movement. It is recommended to open long positions at current price with the target at the level of previous maximum of Chikou Span line (1.8437) and Stop Loss at the upper border of the cloud (1.8188).
CAD/JPY: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading around upper border of the cloud. One of the previous minimums of Chikou Span line is expected to be a support level (89.991). One of the previous maximums of Chikou Span line is expected to be a resistance level (90.666).
On the daily chart Tenkan-sen line is above Kijun-sen, the red line is directed upwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is ascending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (89.442). One of the previous maximums of Chikou Span line is expected to be a resistance level (91.037).
On the four-hour chart we can see a correction of the upward movement. On the daily chart we can see a correction of the upward movement. It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (95.265) line and Stop Loss at the level of Kijun-sen line (88.075).
GBP/CHF: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is going to reverse from ascending to descending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (1.2663). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.2727).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is going to reverse from ascending to descending. The instrument is trading around lower border of the cloud. One of the previous minimums of Chikou Span line is expected to be a support level (1.2586). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.2778).
On the four-hour chart we can see a correction of the downward movement. On the daily chart we can see a correction of the upward movement. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (1.2610) and Stop Loss at the level of Kijun-sen line (1.2727).
ETC/BTC: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument is trading above Tenkan-sen and Kijun-sen lines; the Bullish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (0.0644). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.0708).
On the daily chart Tenkan-sen line is above Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is above the price chart, current cloud is ascending. The instrument has been corrected to the Tenkan-sen line. One of the previous minimums of Chikou Span line is expected to be a support level (0.0620). One of the previous maximums of Chikou Span line is expected to be a resistance level (0.0734).
It is recommended to open long positions at current price with Take Profit at the level of previous maximum of Chikou Span (0.0708) line and Stop Loss at the level of Kijun-sen line (0.0644).
AUD/CHF: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument has been corrected to the Tenkan-sen line. One of the previous minimums of Chikou Span line is expected to be a support level (0.6938). The closest resistance level is Kijun-sen line (0.6967).
On the daily chart Tenkan-sen line is below Kijun-sen, the red line is directed downwards, while the blue one remains horizontal. Confirmative line Chikou Span is below the price chart, current cloud is ascending. The instrument is trading below Tenkan-sen and Kijun-sen lines; the Bearish trend is still strong. One of the previous minimums of Chikou Span line is expected to be a support level (0.6856). The closest resistance level is Kijun-sen line (0.7029).
On the four-hour chart the instrument is still falling. On the daily chart we can see a correction of the upward movement. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (0.6859) and Stop Loss at the level of Kijun-sen line (0.7001).
EUR/CAD: Ichimoku indicators analysis
Let's look at the four-hour chart. Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is crossing the price chart from above, current cloud is going to reverse from descending to ascending. The instrument has been corrected to the Tenkan-sen line. One of the previous minimums of Chikou Span line is expected to be a support level (1.4674). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.4753).
On the daily chart Tenkan-sen line is below Kijun-sen, the lines are horizontal . Confirmative line Chikou Span is below the price chart, current cloud is descending. The instrument has been corrected to the Tenkan-sen line. One of the previous minimums of Chikou Span line is expected to be a support level (1.4598). One of the previous maximums of Chikou Span line is expected to be a resistance level (1.4819).
On the both charts the instrument is still falling. It is recommended to open short positions at current price with Take Profit at the level of previous minimum of Chikou Span line (1.4674) and Stop Loss at the level of Kijun-sen line (1.4753).
EUR/USD: wave analysis
The pair is in a correction, a fall is possible.
On the daily chart, the first wave of the higher level 1 of (3) developed, and a downward correction forms as the second wave 2 of (3). Now, the wave a of 2 has formed, and an upward correction of the lower level is ending to develop as the wave b of 2, within which the formation of the wave (c) of b is ending. If the assumption is correct, after the end of the correction, the pair will fall to the levels of 1.1700–1.1601. In this scenario, critical stop loss level is 1.2350.
Main scenario
Short positions will become relevant after the end of the correction, below the level of 1.2350 with the targets at 1.1700–1.1601. Implementation period: 7 days and more.
Alternative scenario
The breakout and the consolidation of the price above the level of 1.2350 will let the pair grow to the levels of 1.2500–1.2600.
GBP/USD: wave analysis
The pair may fall.
On the daily chart, the first wave of the higher level (1) developed, and a correction forms as the wave (2). Now, the wave A of (2) has formed, and the wave B of 2 has developed, within which the wave c of B has formed. If the assumption is correct, the pair will fall within the wave C of (2) to the levels of 1.3665–1.3573. In this scenario, critical stop loss level is 1.4242.
Main scenario
Short positions will become relevant below the level of 1.4242 with the targets at 1.3665–1.3573. Implementation period: 7 days and more.
Alternative scenario
The breakout and the consolidation of the price above the level of 1.4242 will let the pair grow to the levels of 1.4500–1.4700.
Nvidia Corp.: wave analysis
The price may grow.
On the daily chart, the upward third wave of the higher level (3) develops, within which the wave 3 of (3) formed. Now, a local correction has developed as the fourth wave 4 of (3), and the wave 5 of (3) is forming, within which the first wave of the lower level i of 5 has formed, the correctional wave ii of 5 has ended, and the development of the wave iii of 5 has started. If the assumption is correct, the price will grow to the levels of 750.00–800.00. In this scenario, critical stop loss level is 541.60.
Main scenario
Long positions will become relevant during the correction, above the level of 541.60 with the targets at 750.00–800.00. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 541.60 will let the price go down to the levels of 485.00–425.85.
Alphabet Inc.: wave analysis
The price is in a correction and may grow.
On the daily chart, the upward fifth wave of the higher level (5) develops, within which the third wave 3 of (5) formed. Now, a local correction is developing as the fourth wave 4 of (5). If the assumption is correct, after the end of the correction, the price will grow to the levels of 2550.00–2700.00. In this scenario, critical stop loss level is 2202.40.
Main scenario
Long positions will become relevant after the end of the correction, above the level of 2202.40 with the targets at 2550.00–2700.00. Implementation period: 7 days and more.
Alternative scenario
The breakdown and the consolidation of the price below the level of 2202.40 will let the price go down to the levels of 2050.65–1924.81.
Fundamental Analysis
WTI Crude Oil: possible conclusion of a deal with Iran puts pressure on prices
Current trend
This week, the quotes of WTI Crude Oil correct downwards, testing the level of 62.50 (Murrey [4/8]) today.
The price is currently under pressure from several negative factors. First of all, investors fear the imminent conclusion of a nuclear deal between Iran, the United States, and the EU, which will lead to the lifting of sanctions on the Islamic republic and the inflow of large volumes of Iranian oil to the market. Yesterday, there was information about significant progress in the negotiations, and the EU representatives expressed confidence that the deal would be concluded. Experts believe that this year, global demand will only grow, so new oil supplies from Iran will not put significant pressure on the market.
Yesterday’s EIA report recorded an increase in US oil reserves by 1.321M barrels. However, these data were partially offset by a reduction in gasoline inventories by 1.963M barrels and distillates by 2.324M barrels. Finally, India continues to be a traditional source of negativity for the oil market, where the consumption of oil products is declining due to the negative consequences of the development of the pandemic.
Support and resistance
The price is close to 61.65 (the lower line of Bollinger bands), which is the key “bearish” level. Its breakdown allows a decline to 59.38 (Murrey [2/8]) and 57.81 (Murrey [1/8]). The breakout of 64.30 (Bollinger bands’ midline) allows growth to 65.62 (Murrey [6/8]) and 67.19 (Murrey [7/8]).
Technical indicators do not give a single signal: Bollinger bands are directed upward, confirming the continued upward trend but MACD decreases in the positive zone, and Stochastic is directed downward, which does not exclude the continuation of the decline.
Resistance levels: 64.30, 65.62, 67.19.
Support levels: 61.65, 59.38, 57.81.
Trading tips
Long positions may be opened above 64.30 with the targets at 65.62, 67.19, and stop loss 63.20. Implementation period: 5–7 days.
Short positions may be opened below 61.65 with the targets at 59.38, 57.81, and stop loss 63.10.
USD/CAD: downtrend persists
Current trend
The USD/CAD pair is demonstrating a downward trend, trading at the level of 1.2073, despite the negative outlook on the financial system from the Bank of Canada.
In the submitted report, the regulator highlighted the increased vulnerability of households that took out mortgage loans that do not correspond to their real income. Among the main threats to financial stability, there is a problem of increased demand for liquidity in the bond market, which banks are unable to provide in the current period of increased load. Summarizing the report, Governor of the Bank of Canada Tiff Macklem assured that in this difficult period the department would react to all current and new risks, so there are no serious concerns for the state of the economy.
Yesterday, the American currency did not show clear dynamics, as investors reacted differently to the incoming macroeconomic information. On the one hand, USD was supported by the decrease in Initial Jobless Claims, which amounted to 444K, which is lower than the projected 450K. On the other hand, the manufacturing activity index for May fell very sharply to 31.5 points from 50.2 points for April.
Support and resistance
Locally, the price is forming a downtrend. Technical indicators keep the global sell signal: fast EMAs on the Alligator indicator are below the signal one, and the AO oscillator histogram is trading in the sell zone.
Resistance levels: 1.2133, 1.2317.
Support levels: 1.2022, 1.1900.
EUR/USD: the euro controls the dynamics of the pair
Current trend
The EUR/USD pair continues the upward trend and is currently trading around the level of 1.2236.
The quotes are supported by the publication of inflation data. This figure for the EU for April was 0.6% and 1.6% YoY, which fully coincided with analysts' forecasts. According to these data, the debt market is also strengthening: at yesterday's auctions, long-term bonds of France and Spain showed a significantly increased yield. The yield on Spanish 10-year bonds rose from 0.433% to 0.598%, while the yield on French 5-year bonds jumped from –0.36% to the current –0.19%.
The quotes of the American currency are trading with a slight increase but not enough to change the balance in the pair. Investors around the world are following the proposal of the US Treasury Department to introduce a global corporate income tax practice of at least 15%. According to the regulator, now, the absence of a global general tax does not allow the authorities to receive more funds needed for critical investments. There has been no official reaction to the initiative so far, and negotiations on the international tax architecture between the G20 and the Organization for Economic Cooperation and Development are continuing.
Support and resistance
Globally, the price continues its corrective growth. Technical indicators keep a buy signal: Alligator’s EMA fluctuations range expands, and the AO oscillator histogram trades in the buy zone, forming new upward bars.
Support levels: 1.2177, 1.1957.
Resistance levels: 1.2325, 1.2500.
Trading tips
After growth or consolidation above the local resistance of 1.2325, buy positions with a target around 1.2500 are relevant. Stop loss – 1.2260. Implementation period: 7 days or more.
After a decrease or consolidation below the local support of 1.2177, sell positions with the target at 1.1957 are relevant. Stop loss – 1.2230.
USD/JPY: positive reports support the yen
Current trend
The USD/JPY pair is correcting around the level of 108.71.
The Japanese currency began to rally after the country's Ministry of Health announced approval for the use of two vaccines: from the companies Moderna and AstraZeneca. According to the Ministry of Health, the Moderna vaccine will begin to be used as early as May 24 but the use of the AstraZeneca vaccine has been postponed for now. Also, the instrument is positively influenced by macroeconomic statistics. Japan's nationwide core consumer price index for April was –0.1% YoY, better than analysts’ expectations of –0.2%. The consumer price index reached –0.4%, while the Service PMI is at the level of 45.7 points.
The key data for the American currency was an unexpected reduction in the number of Initial Jobless Claims, amounting to 444K, which is less than the expected 450K. The average number of applications over the past 4 weeks also decreased to 504.75K against 535.25K a week earlier. However, the positive was short-lived, and data on the manufacturing activity index from the Federal Reserve Bank of Philadelphia for May stopped the upward trend. The indicator dropped to 31.5 points from 50.2 points a month earlier.
Support and resistance
The instrument moves within an upward corrective trend, forming an upward channel, which can subsequently transform into a Flag pattern. Technical indicators are in a state of uncertainty: fast EMAs on the Alligator indicator almost crossed with the signal line, and the histogram of the AO oscillator approached the transition level.
Resistance levels: 109.33, 110.75.
Support levels: 108.35, 107.48.
Trading tips
After decline or consolidation below the local support at 108.35, it is relevant to open sell positions with the target at 107.48. Stop loss – 109.00. Implementation period: 7 days or more.
After reversal and continued growth or consolidation above 109.33, positions for purchase with the target at 110.75 will become relevant. Stop loss – 108.70.
FTSE 100: the index continues to correct
Current trend
The London Stock Exchange's leading index, the FTSE 100, shows ambiguous dynamics, trading at 7020.0 amid significantly increased volatility in the bond market.
After ambiguous statements from the US Federal Reserve regarding a possible change in the course of monetary policy, the yield on securities on all global exchanges began to rise. UK 10-year bonds have not responded as strongly as European bonds, as they are already trading at highs. The yield is now 0.8380%, well above the 0.2500% at the start of the year.
The second factor that significantly increased the volatility of the instrument was the continuing reporting of the leading components of the index. The main postal service in the UK is Royal Mail Group Plc. reported a 116% increase in operating profit for the year. Yesterday, the shares of the UK's leading seller of train tickets, Trainline Plc., fell by nearly 30% after the government announced reforms that would create a rival ticketing application.
Among the growth leaders in the index are Experian Plc. (+4.73%), Rightmove Plc. (+3.84%), and Compass Group Plc. (+3.63%).
Among the companies showing a downward trend are Antofagasta Plc. (–2.31%), Tesco Plc. (–2.31%), and International Consolidated Airlines Group S.A. (–1.41%).
Support and resistance
Index quotes are correcting. Technical indicators are in a state of uncertainty and signal the presence of a correction: the fluctuation range of the EMA of the Alligator indicator is quite narrow, and the histogram of the AO oscillator is trading at the transition level.
Support levels: 6981.0, 6853.0.
Resistance levels: 7064.0, 7166.0.
Trading tips
After growth or consolidation above the local resistance level of 7064.0, buy positions with the target at 7166.0 and stop loss 7000.0 will be relevant. Implementation period: 7 days or more.
After reversal and corrective decline or consolidation below the local support at 6981.0, sell positions with the target at 6853.0 will be relevant. Stop loss – 7050.0.
GBP/USD: the instrument is preparing to renew the February high
Current trend
The British pound continues to strengthen against the US dollar and is approaching 1.4240 amid positive data from the UK and the gradual lifting of quarantine restrictions, which gives hope to investors for a quick economic recovery after the COVID-19 pandemic.
Domestic inflation rose to 1.5% in April, beating market expectations at 1.4%, while the GFK consumer confidence index strengthened to –9 in April from a previous reading of –15 in March. Today’s April data on the volume of retail sales also were positive: the indicator increased by 9.2% and hit a record of 42.4% YoY. Another driver of the upward trend in GBP is the renewed GDP forecast published by the Bank of England, which assumes growth of 5.9% in 2021 and 5.3% in 2022 (previous indicators were at the level of 5.0% and 5.5%, respectively).
Brexit continues to have a slight impact on the pound's position. British Leaving Secretary Stephen Barclay confirmed that the EU is not fulfilling its treaty obligations regarding trade agreements with Northern Ireland, which creates a tense situation and shifts the timeline for the settlement of the issue.
Support and resistance
The long-term trend in the GBP/USD pair remains upward. At the moment, the price is preparing to renew its February high, after which it can rise to the resistance area of 1.4336.
Within the medium-term upward trend, the target zone 1.4092–1.4053 was broken. The next target of asset growth is target zone 2 (1.4476–1.4437). The nearest support, where buy positions can be opened, is the level of 1.4030. The border of the trend is shifting to the area of 1.3876–1.3815.
Resistance levels: 1.4184, 1.4336, 1.4602.
Support levels: 1.4050, 1.3813, 1.3687.
Trading tips
Long positions may be opened from the level of 1.4050 with the target at 1.4240 and stop loss 1.3987. Implementation period: 7–9 days.
Short positions may be opened below the level of 1.3986 with the target at 1.3813 and stop loss 1.4071.
Alibaba Group Holdings Ltd.: general review
Current trend
The stocks of Alibaba Group Holdings Ltd. ADR, one of the world's largest e-commerce companies, correct, trading at the level of $216 per share.
At the beginning of the week, the financial statements for the next quarter and the entire financial year, which ended in March 2021, were published. Revenue increased by 64% to RMB 187.395B, or $28.602B. The annual number of active consumers of services in China amounted to 811M, which is 32M more than a year earlier. The loss from operating activities amounted to RMB 7.633B or $1.170B, mainly due to a fine of 2.782B that was imposed by the State Market Regulatory Administration of China for violating antitrust laws. Adjusted EBITDA increased by 14% over the same period a year earlier. GAAP diluted earnings per share were $10.32, nearly half the level of the previous quarter.
In general, the company's report showed its absolute stability, and the fine is already reflected in it, therefore, there are no reasons for the continued decline in quotations, and the securities may begin to recover.
Support and resistance
Quotes are moving within the global Wedge pattern, trying to grow. Technical indicators are in a state of global selling but they are beginning to reverse: the range of EMA fluctuations on the Alligator indicator is narrowing, and the histogram of the AO oscillator is approaching the transition level from below.
Resistance levels: 226.00, 250.00.
Support levels: 205.00, 200.00.
Trading tips
After growth or consolidation above the local resistance of 226.00, buy positions with the target at 250.00 will be relevant. Stop loss is 210.00, below the current price. Implementation period: 7 days or more.
After reversal and a decline or consolidation below the pattern support line of 205.00, it is relevant to open sell positions with the target at 200.00 and stop loss 207.00.
Pfizer Inc.: general review
Current trend
The shares of Pfizer Inc. are trading at a 5-month high, gaining more than 3.5% since early May. The growth of the instrument since the middle of last month was 8%, and over the past week it strengthened by 0.05%, while the S&P 500 index added 1.16%.
Pfizer Inc. and BioNTech entered into a deal with the European Union authorities for the supply of 900M doses of COVID-19 vaccine with the possibility of an additional purchase of another 900M doses. The first batches will be received in December of this year (cooperation is planned until 2023 inclusive). Vaccine from Pfizer Inc. is recommended by the US Centers for Disease Control and Prevention (CDC) for 12–15 years children. Also, the issuer announced plans to manufacture a key component of its anti-coronavirus drug at a plant in Ireland.
Formerly Pfizer Inc. published a strong quarterly report and raised its forecast for 2021, expecting revenues of $70.5–72.5B with earnings per share in the range of $3.55–3.65.
Support and resistance
The “bullish” sentiment still prevails in the company's shares — the quotes have renewed the local highs. At the moment, the issuer is consolidating in the range of 39.00–41.00, with the potential for further growth.
Indicator signals are different: the price consolidated above MA (50) and MA (200); MACD started to decline. It is better to open the positions from the key levels.
Comparative analysis of multiples of the company and competitors in the industry indicates the neutrality of #PFE.
Support levels: 39.00, 38.00, 36.75.
Resistance levels: 41.00, 43.00.
Trading tips
Long positions may be opened after the price consolidates above the level of 41.00. The closing of the profitable positions is possible at the levels 42.50, 44.00, and 45.00. Stop loss – 39.50. Implementation period: 3 days.
Short positions may be opened after the price consolidates below the level of 39.00 with the targets at 36.50–35.00. Stop loss – 40.50.
HP Inc.: general review
Current trend
The shares of HP Inc. are trading near the month’s low, reflecting an 11% downtrend from a new 52-week high of May 10. Over the past three months, the instrument has strengthened by 18.5%, and over the week, it showed a decline of 1.08%, while the S&P 500 index added 1.16%.
On Thursday, May 27 after market close, HP Inc. will publish quarterly results. Revenue is expected to grow 21% YoY to $15B, with a 74.5% YoY increase in EPS of $0.89.
Also, the company unveiled a new line of OMEN gaming hardware and software and announced a new Victus by HP brand for the mainstream in response to the growing demand from the game industry.
Support and resistance
The company's shares went down after a prolonged growth, renewing the local lows. At the moment, the issuer is consolidating in the range of 31.00–33.10. There is potential for further correction.
Indicators do not give accurate signals: the price has fixed between MA (50) and MA (200); MACD is showing negative dynamics. It is better to open the positions from the key levels.
Comparative analysis of multiples of the company and competitors in the industry indicates the neutrality of the instrument.
Support levels: 31.00, 29.00, 27.50.
Resistance levels: 33.10, 36.00.
Trading tips
Short positions may be opened after the price consolidates below the level of 31.00. The closing of the profitable positions is possible at the levels of 29.00, 27.00, and 25.00. Stop loss – 33.00. Implementation period: 3 days.
Long positions may be opened after the price consolidates above the level of 33.00 with the targets at 37.00–39.00. Stop loss – 29.10.
EUR/TRY: lira continues to weaken
Current trend
The EUR/TRY pair has been trading within an uptrend since this February.
On Monday, the Turkish currency tried to strengthen amid a statement by Turkish President Recep Tayyip Erdogan about lump-sum payments to enterprises affected by the pandemic in the amount of 4.6B lira. Then the pair resumed its growth and the price reached annual highs around 10.2970. In general, the Turkish economy continues to be under pressure due to the threat of disruption of the tourist season amid poor vaccination of the population, as well as rising unemployment. According to the latest data from the Turkish Statistical Institute (TurkStat), in the first quarter of this year, this indicator in the country increased from 12.8% to 12.9%, while the level of consumer confidence in Turkey fell for the second time in a row and reached 77 3 points for May.
Against this background, the European currency looks more attractive to investors. Despite a 1.8% YoY decline in EU Q1 GDP, there are strong prospects for economic growth to resume by the end of this year. In the summer months, European Union authorities plan to vaccinate up to 70% of the adult population, which will reduce restrictive measures and restore consumption. Today’s preliminary May data on business activity were also positive, with the Manufacturing PMI declining slightly from 62.9 points to 62.8 points and Services PMI growing from 50.5 points to 55.1 points, which is the best indicator since 2018.
Support and resistance
The price has broken the reversal level 10.1562 (Murrey [6/8]) and may continue to rise to the levels of 10.4000 and 10.5468 (Murrey [7/8]). The key “bearish” level is 10.0800 (the middle line of Bollinger Bands). The consolidation below it will give the prospect of a decline to the area of 9.8385 (lower line of Bollinger bands), 9.7656 (Murrey [5/8]).
In general, the indicators point to continued growth: Bollinger bands and Stochastic are directed upwards, and the MACD histogram is stable in the positive zone.
Resistance levels: 10.4000, 10.5468.
Support levels: 10.0800, 9.8385, 9.7656.
Trading tips
Long positions may be opened from the current level with the targets at 10.4000, 10.5468, and stop loss around 10.1560. Implementation period: 5–7 days.
Short positions may be opened below 10.0800 with the targets at 9.8385, 9.7656, and stop loss 10.2820.
AUD/USD: the instrument may continue to rise
Current trend
The AUD/USD pair continues to trade within the upward channel. This week, the price dropped to its lower border but could not break it, as the Australian currency received support after the publication of unemployment data (for April, the indicator reached the year’s low of 5.5%).
Today, the price is correcting downwards again on the back of the publication of business activity indices for May: Manufacturing PMI rose from 59.7 to 59.9 points and Service PMI decreased from 58.8 to 58.2 points. Nevertheless, both indicators remained in the growth zone, and business remained optimistic. For April, Australian retail sales slowed growth from 1.3% to 1.1% but continued to increase for the second consecutive month.
The US dollar is supported by the data on the initial jobless claims in the US. The indicator decreased from 478K to 444K and reached the lowest figure during the pandemic. However, investor optimism remained subdued, as the number of continuous jobless claims increased to 3.751M, and the full recovery of the labor market is still far away.
Support and resistance
Now the price is around the middle line of Bollinger bands (0.7765), trying to decline to the lower border of the ascending channel (0.7720). After its breakdown, the decline will continue to the level of 0.7630 (Murrey [1/8]). The key “bullish” level is 0.7812 (Murrey [4/8]), the breakout of which will give the prospect of further growth to the levels of 0.7873 (Murrey [5/8]) and 0.7934 (Murrey [6/8]).
The indicators are generally neutral: Bollinger bands and Stochastic are directed horizontally, while the MACD histogram is stable in the positive zone.
Resistance levels: 0.7812, 0.7873, 0.7934.
Support levels: 0.7720, 0.7630.
Trading tips
Long positions may be opened above 0.7812 with the targets at 0.7873, 0.7935, and stop loss 0.7770. Implementation period: 5–6 days.
Short positions may be opened below 0.7720 with the target at 0.7630 and stop loss 0.7765.
NZD/USD: the instrument is waiting for new drivers
Current trend
NZD is showing ambiguous performance against USD during today's morning session, building on the flat trend that has emerged in recent days.
Today, NZD is receiving little support from strong macroeconomic statistics from New Zealand. Meanwhile, retail sales in Q1 2021 showed solid 2.5% QoQ growth after a 2.7% QoQ decline last month. Analysts had expected the negative dynamics to worsen to –4.4% QoQ. Retail Sales excluding Autos for the same period accelerated from +4.8% QoQ to +6.8% QoQ, significantly outperforming the projected +1.9% QoQ.
Market activity remains subdued as investors expect new drivers to emerge. One of such events will be the meeting of the Reserve Bank of New Zealand on interest rates, which will be held on Wednesday, May 26. Analysts do not expect changes in the vector of monetary policy, but comments from officials will continue to be important.
Support and resistance
Bollinger Bands in D1 chart demonstrate flat dynamics. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD is going down, keeping a fairly stable sell signal (located below the signal line). Stochastic, having approached the level of "20", reversed into a horizontal plane, indicating the risks of oversold instrument in the ultra-short term.
Resistance levels: 0.7200, 0.7250, 0.7305, 0.7350.
Support levels: 0.7150, 0.7100, 0.7050, 0.7000.
Trading tips
To open long positions, one can rely on the rebound from the support level of 0.7150 with the subsequent breakout of 0.7200. Take-profit – 0.7250. Stop-loss – 0.7175. Implementation time: 2-3 days.
The breakdown of 0.7150 may serve as a signal to new sales with the target at 0.7100. Stop-loss – 0.7180.
USD/CAD: positive statistics supported the pair
Current trend
Today during the Asian session, the USD/CAD pair is showing ambiguous trading dynamics, trying to consolidate above the level of 1.2050, which was actively tested at the end of last week.
The instrument is supported by technical factors of closing profitable short positions, as well as positive US macroeconomic statistics released on Friday. Thus, the Manufacturing PMI from Markit for May rose from 60.5 to 61.5 points, which was better than the market's expectations of a decrease to 60.2 points. In the service sector, the corresponding indicator increased from 64.7 to 70.1 points, which also was better than the negative forecasts of 64.5 points.
Thus, the American economy continues its confident recovery from the coronavirus crisis, which should soon be reflected in the actions of the US Federal Reserve. The regulator still prefers to take a wait-and-see attitude, explaining the sharp rise in inflation only for temporary reasons.
Support and resistance
On the daily chart, Bollinger bands steadily decline. The price range actively narrows, indicating the ambiguous dynamics of the last days. The MACD indicator grows, maintaining a relatively strong buy signal (the histogram is above the signal line). Stochastic grew last week but now reversed into a downward plane, reacting to the return of the “bearish” dynamics to the market.
A full-fledged uptrend may form in the short and/or super short term.
Resistance levels: 1.2129, 1.2200, 1.2245, 1.2300.
Support levels: 1.2000, 1.1930, 1.1850.
Trading tips
Long positions may be opened after the breakout of 1.2129 with the target at 1.2300. Stop loss – 1.2040. Implementation period: 2–3 days.
Short positions may be opened after the breakdown of 1.2000 with the target at 1.1900. Stop loss – 1.2060.
GBP/USD: GBP is showing near-zero dynamics
Current trend
GBP is trading ambiguously against USD during today's morning session, consolidating at 1.4150.
GBP ended last week with uncertain gains; however, the record highs on February 24 were not renewed, despite the publication of strong macroeconomic statistics from the UK. Retail sales in April rose by record 42.4% YoY after increasing by only 7.2% YoY in March. Experts expected an increase of 36.8% YoY. On a monthly basis, sales volumes rose from 5.1% MoM to 9.2% MoM, which was also better than market forecasts of 4.5% MoM.
The data on business activity in the manufacturing sector were also positive, strengthening from 60.9 to 66.1 points in May, while experts had expected a slight decline to 60 points.
Support and resistance
Bollinger Bands in D1 chart show stable growth. The price range is narrowing, reflecting the emergence of ambiguous dynamics of trading in the short term. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic, having retreated from the level of "80" at the end of last week, again reversed into a horizontal plane, reacting to the neutral dynamics on Monday.
To open new trading positions, it is necessary to wait for the signals from technical indicators to be clarified.
Resistance levels: 1.4150, 1.4200, 1.4232, 1.4275.
Support levels: 1.4100, 1.4050, 1.4000, 1.3960.
Trading tips
To open long positions, one can rely on the breakout of 1.4200. Take-profit – 1.4300. Stop-loss – 1.4150. Implementation time: 2-3 days.
The return of "bearish" trend with the breakdown of 1.4100 may become a signal for further sales with target at 1.4000. Stop-loss – 1.4150.
EUR/USD: neutral trading dynamics
Current trend
The EUR/USD pair is growing, trading around the level of 1.2187.
The macroeconomic statistics released on Friday were perceived by the market as neutral. Among the positive indicators is EU Manufacturing PMI for May, which reached 62.8 points, which is higher than analysts predicted 62.5 points. At the same time, the decline in the corresponding indicator in Germany to 64.0 points from 66.2 points earlier disappoints investors. Among the positive indicators, there is an increase in EU Service PMI to 55.1 points from 50.5 points earlier.
USD is slightly strengthening after new details of the talks between the representatives of the United States and Iran became known. Although the final decision is still far away, there are already hints that some of the sanctions against Iran may be lifted. This was stated by US Secretary of State Anthony Blinken in an interview for ABC TV channel. As for macroeconomic statistics, it is worth noting only a slight increase in the US Manufacturing PMI for May to 61.5 points from 60.5 points earlier.
Support and resistance
Globally, the price continues its corrective growth. Technical indicators keep a buy signal: the swing range of the EMA on the Alligator indicator is expanding, and the histogram of the AO oscillator is trading in the buy zone, although it is forming downward bars.
Resistance levels: 1.2243, 1.2348.
Support levels: 1.2145, 1.1995.
Trading tips
After growth or consolidation above the local resistance of 1.2243, buy positions with the target at 1.2348 are relevant. Stop loss – 1.2200. Implementation period: 5 days.
After a decline or consolidation below the local support at 1.2145, you can open with the target at 1.1995 are relevant. Stop loss – 1.2200.
USD/CHF: the instrument continues to decline actively
Current trend
The USD/CHF pair decreases due to the strengthening Swiss franc, trading at 0.8972.
On Friday, the Swiss National Bank announced renewed forecasts for inflation for the next period. According to the regulator, the turning point in the trend occurred in the middle of 2020, and the rest of the time the indicator will gradually increase. For the second quarter of this year, the growth rate of the indicator is forecasted to accelerate to 0.3% and at the end of the year – to 0.6%, after which the indicator may again drop to the level of 0.3%. In general, this forecast coincides with the target inflation rate and reflects the positive pace of economic recovery in the country.
The USD Index is moving without pronounced dynamics, trading around the psychological level of 90 points. Existing home sales data were released on Friday, disappointing investors again. In April, the indicator fell to 5.85M, although in March it was 6.01M. Only preliminary data on Service PMI for May were positive: the value rose to 70.1 points, which is higher than the 64.5 predicted by analysts.
Support and resistance
Globally, the price declines within a global correction. Technical indicators keep the global sell signal: Alligator indicator’s EMA fluctuations range is still wide, and the histogram of the AO oscillator is in the sell zone.
Resistance levels: 0.9043, 0.9220.
Support levels: 0.8917, 0.8757.
Trading tips
After decline or consolidation below the local support level of 0.8917, sell positions with the target at 0.8757 are relevant. Stop loss is 0.9000. Implementation period: 7 days or more.
After reversal and growth or consolidation above the local resistance level of 0.9043, buy positions with the target at 0.9220 are relevant. Stop loss is 0.8950.
S&P 500: growth amid falling bond yields
Current trend
The S&P 500 is correcting upwards, recovering from a significant decline earlier in the month and trading at 4167.0.
Analytical group JPMorgan Chase & Co has published updated forecasts for the dynamics of the S&P 500, according to which the average net EPS of the companies that make up the index could rise to USD 200 by the end of this year, and in 2022 this figure could rise to USD 225 per share. In this regard, the forecast for 2021 was left at 4400 points.
Additional support for the S&P 500 was provided by another correctional decline in the bond market. 10-year Treasury yields have again retreated from their highs and are now at 1.618%, continuing to demonstrate a downtrend.
The growth leaders in the index are: Ford Motor Co. (+6.73%), H&R Block Inc. (+5.02%), Lamb Weston Holdings Inc. (+3.46%).
Among the leaders of the decline are: VF Corporation (–8.94%), Seagate Technology Plc. (–3.00%), Progressive Corp. (–2.84%).
Support and resistance
Index quotes continue to grow within the upward correction. The fluctuation range of the EMAs on the Alligator indicator began to expand again, and the histogram of the AO oscillator is trading in the buy zone, although it forms descending bars.
Resistance levels: 4190.0, 4240.0.
Support levels: 4150.0, 4060.0.
Trading tips
If the asset continues growing and the price consolidates above the local resistance at 4190.0, long positions will be relevant with target at 4240.0. Stop-loss – 4160.0. Implementation time: 5 days.
If the asset reverses and declines and the price consolidates below 4150.0, short positions can be opened with the target at 4060.0. Stop-loss – 4200.0.
AUD/USD: the asset is trading in correction
Current trend
The AUD/USD pair ended Friday's trading with a correction, shedding 0.59% on the strength of USD following the release of strong data on business activity in the US.
Manufacturing PMI in May rose to 61.5 points, which turned out to be higher than the projected 60.2 points, and also exceeded the previous indicator at 60.5 points. Services PMI rose to 70.1 points against expectations at 64.5 points and the previous value of 64.7 points. However, Existing Home Sales in April fell from 6.09M to 5.85M. In percentage terms, the indicator turned out to be in the negative zone and amounted to –2.7%, although analysts had expected an increase of 2.0%.
In turn, AUD is supported by the data on the labor market, published last week. In April, the employment rate increased by 33.8K after the decline in March, when due to the termination of the JobKeeper program, 21.1K people became unemployed. Unemployment rate fell by 0.1% to 5.5%. Labor market indicators show that the Australian government is on track to recover from the pandemic.
Support and resistance
The long-term trend in the AUD/USD pair is upward. The trend border is at 0.7580. Now the instrument is trading in correction and is approaching the support level of 0.7703, holding which will allow it to rise to 0.7843. A breakdown of the support level will allow the "bears" to test the trend line.
The mid-term trend is also upward. The asset is working out a corrective model in order to update the May 13 low. The breakout or holding of the key support of the trend in the range of 0.7710–0.7692 will show the further direction for entering the position.
Resistance levels: 0.7843, 0.7967.
Support levels: 0.7703, 0.7580.
Trading tips
Long positions may be opened above 0.7843 with target at 0.7967 and stop-loss at 0.7802. Implementation time: 7-9 days.
Short positions may be opened below 0.7703 with target at 0.7580 and stop-loss at 0.7764.
BTC/USD: BTC price continues to fall
Current trend
Last week, the BTC/USD pair continued its active decline and reached its lows of this January, dropping below the level of 29700.00. Currently, the price has recovered some of its losses and reached the area of 36600.00 but the general downward trend continues.
The first cryptocurrency came under new pressure after the statement by Vice Premier of the State Council of the People's Republic of China Liu He at a meeting of the Financial Stability Committee. The official urged to fight against mining and cryptocurrency trading, which implies the adoption of new measures of pressure on the industry. After that, several large mining pools announced the suspension of their activities in the PRC. The BTC.TOP pool announced the complete termination of the business, and HashCow promised to stop its expansion and modernization of technical systems.
Additional pressure on the market is exerted by American regulators. The US Treasury Department announced its intention to oblige businesses to report cryptocurrency transactions in excess of $10K to the tax office, which should ensure greater market transparency.
Support and resistance
Currently, the key “bearish” level is 33000.00. Its breakdown allows a decline to 25000.00 (Murrey [4/8]). The consolidation above 43750.00 (Murrey [3/8]) allows growth to 50000.00 (Murrey [4/8]) and 56250.00 (Murrey [5/8]). However, this variant of price movement is still less likely since the indicators generally reflect a continuation of the decline: Bollinger bands reverse downwards, the MACD histogram grows in the negative zone but Stochastic is directed horizontally.
Resistance levels: 37500.00, 43750.00, 50000.00, 56250.00.
Support levels: 33000.00, 25000.00.
Trading tips
Short positions may be opened below 33000.00 or upon a price reversal from 43750.00 with the target at 25000.00 and stop loss 38000.00 and 48800.00, respectively. Implementation period: 5–7 days.
Tesla Inc.: general review
Current trend
The stocks of Tesla Inc. grow within a correction by 6.4% from a 6-month low. The fall of the instrument since mid-April was 24%. Over the past week, the rate fell by 1.50%, while the S&P 500 index lost 0.45%.
The company's shares are under pressure from a 48% drop in BTC from an April high after Elon Musk announced that the company would not accept cryptocurrency as a means of payment, as well as China's ban on banks and financial institutions to conduct transactions in cryptocurrency. Earlier, the corporation acquired BTC for $1.5B and in the current situation will reflect the loss in the second quarter. Last week, the prices of Model 3 and Model Y increased. The company executive earlier said that Tesla Inc. evaluates the possibility of opening a plant for the production of electric cars in Russia against the background of growing demand in the region.
Support and resistance
The issuer is dominated by the “bearish” sentiments. The quotes have renewed the local lows. At the moment, the company's shares are consolidating in the range of 545.00–600.00. There is potential for further correction.
Indicator signals are ambiguous: the price consolidated below MA (50) and MA (200); MACD started to rise. It is better to open the positions from the key levels.
Comparative analysis of multiples of the company and competing companies in the industry shows that the instrument is overpriced.
Resistance levels: 600.00, 715.00, 775.00.
Support levels: 545.00, 460.00, 380.00.
Trading tips
Short positions may be opened after the price consolidates below 545.00. The closing of the profitable positions is possible at 490.00, 440.00, and 400.00. Stop loss – 600.00. Implementation period: 3 days.
Long positions may be opened after the price consolidates above 600.00 with the targets at 700.00–750.00. Stop loss – 545.00.
Caterpillar Inc.: general review
Current trend
Caterpillar Inc. shares show a 3.5% corrective decline from a new 52-week high of May 17. Since the end of April, the company's shares have grown by 4%. Over the past week, the emitter decreased in value by 2.06%, while the S&P 500 index dropped by 0.45%.
At the end of April, Caterpillar Inc. released a strong quarterly report, noting growing demand for bulldozers, haul trucks, and other equipment as the global economy recovers. In addition, increased infrastructure spending, especially in China, is driving investment in new machines. In Q2, the company expects sales to grow in the construction industry, an increase in demand in the mining industry and a moderate increase in operating margins compared to Q1. The emitter announced the annual general meeting of shareholders on June 9.
Support and resistance
The current technical picture indicates a possible correction of the company's shares after prolonged growth. The emitter shows a reversal formation: price and MACD divergence. Currently, the local support and resistance levels are at 235.00 and 245.00, respectively.
Indicators don't give a clear signal: the price crossed MA(50); MACD histogram started to decline. Positions are to be opened from key levels.
Comparing the company's multiplier with its competitors in the industry, we can say that #CAT shares are neutral.
Resistance levels: 245.00.
Support levels: 235.00, 225.00, 216.50.
Trading tips
If the price consolidates below 235.00, #CAT shares may correct. Potential profits should be locked in by orders at 225.00, 215.00, and 205.00. Stop-loss – 245.00. Implementation period: 2–3 days.
If the price consolidates above 245.00, one may consider buying the company's stock. The moving potential is aimed at the area of 260.00–270.00. Stop-loss – 235.00.
Microsoft Inc.: general review
Current trend
The price of shares of Microsoft Inc., a global giant in the development and sale of operating systems and software for computers, is moving in a corrective trend, being around $245 per share.
The news has appeared on the company's website that it will finally end support for the Internet Explorer browser on Tuesday, June 15, 2022. The new browser that is already present in the version of the Windows 10 operating system will be Microsoft Edge. It will feature an IE mode that will allow browser users to access legacy applications and websites.
On May 19, the register of shareholders was closed for the payment of quarterly cash dividends for 2020 in the amount of $0.56 per share. The payment will take place on June 10, 2021, and the estimated profitability may reach 0.91% per annum, which is the average for the corporation since the beginning of 2020.
Support and resistance
On the global chart of the asset, the price has completed a downward correction and is preparing a reversal. Technical indicators are in the state of a sell signal but are already ready to reverse: the fluctuation range of the Alligator EMA indicator began to narrow, and the AO oscillator histogram, trading in the sell zone, forms upward bars.
Resistance levels: 248.00, 263.00.
Support levels: 239.00, 225.00.
Trading tips
After global growth or consolidation above the local maximum around 248.00, buy positions with the target at 263.00 will be relevant. Stop loss is 240.00, below the resistance level. Implementation period: 7 days or more.
After decline or consolidation below the support level of 239.00, it is relevant to open sell positions with the target at 225.00 and stop loss 250.00.
USD/JPY: Haruhiko Kuroda's rhetoric did not support JPY
Current trend
USD is trading with ambiguous dynamics against JPY in today's Asian session, consolidating near 108.70.
Yesterday's trading was marked by a slight decrease in the rate of USD; however, in general, the market sentiment remained practically unchanged. Investors ignore the positive macroeconomic statistics from the US and are focused on the future policy of the US Fed, which refuses to recognize rising inflation as a threat to the national economic recovery.
The market also reacted poorly to the speech of the Governor of the Bank of Japan Haruhiko Kuroda on Monday. The head of the Japanese regulator touched upon the global recovery of the world economy after the coronavirus crisis, warning that the stabilization process would be heterogeneous and could lead to increased economic inequality.
Support and resistance
On the D1 chart, Bollinger Bands are gradually reversing horizontally. The price range expands slightly from below, indicating prevailing "bearish" sentiment in the short term. MACD is declining keeping a weak sell signal (located below the signal line). The indicator is trying to consolidate below the zero level. Stochastic, having approached the level of "20", is trying to reverse into an upward plane, reflecting the growing risks associated with an oversold USD in the ultra-short term.
Existing short positions should be kept in the short and/or ultra-short term until the signals from technical indicators clear up.
Resistance levels: 109.00, 109.37, 109.84, 110.23.
Support levels: 108.54, 108.20, 107.78, 107.46.
Trading tips
To open new short positions, one can rely on the breakdown of 108.54. Take-profit – 107.78–107.46. Stop-loss – 109.00. Implementation time: 2-3 days.
A rebound from 108.54 as from support followed by a breakout of 109.00 may become a signal for new purchases with the target at 109.84. Stop-loss – 108.54.
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