Indices Updates by Solid ECN

[Solid ECN]

One of the leading indexes of the American economy Dow Jones moves downward around 32080.

The main news of the past week was the statement of the head of Tesla Inc., Elon Musk, that the deal to buy the social network Twitter is temporarily suspended due to verification of data confirming calculations that fake accounts make up no more than 5% of the total number of daily active users. Shares of the service immediately reacted to this with a drop of 25%, although they later partially recouped losses after the entrepreneur, in a new tweet, said that he still intends to complete the deal.

Meanwhile, the yield on the popular 10-year government bonds fell to 2.908% late last week, while the conservative 20-year notes lost just over 1.00% and are now trading at 3.3057%, which is still quite high, so the negative pressure on the stock market remains.

The asset moves within a wide downward channel, approaching the support line. Technical indicators maintain a stable sell signal: indicator Alligator’s EMA fluctuations range is actively expanding, and the histogram of the AO oscillator is forming new downward bars in the sell zone.

Resistance levels: 32550, 34100 | Support levels: 31620, 30000​

 

[Solid ECN]

On the daily chart, the price is falling within a narrow downwards channel, gradually approaching the support line. The key support is the channel's lower line, which coincides with the initial 61.8% Fibonacci extension trend level at 41.

On the 4-hour chart of the asset, it is clear that the global decline will continue, and the channel support line is only an initial target. The global downside target is the underlying trend of 100.0% for the Fibonacci expansion, around 29. Technical indicators also confirm the high probability of further decline: fast EMAs on the Alligator indicator are much lower than the signal line, and the AO oscillator histogram is forming downward bars in the sell zone.

 

[Solid ECN]

Visa, technical analysis​

The shares of Visa Inc. Class A, the largest American multinational company providing payment transaction services, are corrected at 203.00.

On the daily chart of the asset, a global side channel is developing with the boundaries of 189 - 235, and at the moment, the price has reversed upwards from its support line.

Primary signs of a reversal appeared on the four-hour chart: the price has broken the local resistance around 200.00. Technical indicators also point to a high probability of continued growth: indicator Alligator’s EMA fluctuations range began to actively narrow, fast EMAs are approaching the signal line, and the AO oscillator histogram began to form new rising bars in the sell zone.

 

[Solid ECN]

One of the leading indexes of the European economy, CAC 40, is correcting, trading at the level of 6288.0. The French stock market is falling on the back of a recovery of positive dynamics in the bond market, and even positive reports of large components are not able to reverse the negative trend.

The day before, a large energy company Engie SA published its financial results. The company's Q1 2022 revenue rose sharply to 25.6 billion euros, well above the forecast of 14.28 billion euros. Earnings per share increased to 0.62 euros from 0.3995 euros a quarter earlier. In turn, the report of one of the largest European stock exchanges Euronext NV showed an increase in the company's income to 395.7 million euros, which exceeded 370.1 million euros a quarter earlier. At the same time, earnings per share were worse than expected and amounted to 1.35 euros against the expected 1.45 euros.

The French bond market is again showing positive dynamics. Popular 10-year bonds have returned to growth and are trading at a rate of 1.518%, while conservative 20-year treasury bonds have reached a yield of 1.855%, which is slightly behind the peak values at the beginning of the month at 1.945%.

The index quotes are traded within the global downtrend, continuing to fall along the resistance line. Technical indicators are holding a local sell signal: the range of EMA fluctuations on the Alligator indicator is still wide enough and the AO oscillator histogram, trading in the sales area, is forming ascending bars.

Support levels: 6065, 5750 | Resistance levels: 6530, 6800​

 

[Solid ECN]

The shares of Tesla Inc., the world's leading manufacturer of electric cars, continue their global correction, trading at 709.

On the daily chart of the asset, the price is moving within the global Expanding formation pattern with dynamic extremes at 1150–500. At the moment, the instrument is forming the fifth wave of the pattern, which is one of the two most probable waves.

On the four-hour chart, the rate can already break the low of the third wave at 700.00 today, which will be a signal to continue the downward movement. The readings of technical indicators confirm the likelihood of a decline: fast EMAs on the Alligator indicator are actively moving away from the signal line, and the AO oscillator histogram is forming bars with a downward trend in the sell zone.

 

[Solid ECN]

Global sideways correction in the shares of the American diversified corporation General Electric Co. strengthens, and papers are traded slightly above 75.00.

On the daily chart of the asset, a wide downward channel with dynamic boundaries of 71 - 90 forms, within which the price has reached the support line and renewed the year’s low around 71.

On the four-hour chart, the price is heading upwards and begins to form a Head and shoulders reversal pattern, which target for working out is around the global channel resistance line 90. The readings of technical indicators confirm the high probability of upward dynamics: fast EMAs on the Alligator indicator are actively approaching the signal line, and the AO oscillator histogram is forming new rising bars in the sell zone.

 

[SOLIDECN]

The shares of Snap Inc., the US company that owns the Snapchat messenger, are moving in a global downtrend around 13.

On the daily chart of the asset, a global downward channel is forming, which emerged from the Triangle pattern, renewing the year's low at 12.8. During yesterday's trading, the instrument formed a downward price gap, making the prospects for upward dynamics practically zero.

On the four-hour chart, it can be seen that although the quotes are near the channel support line, the most likely scenario will be a further decline to the target levels around 4. Technical indicators keep a stable sell signal: indicator Alligator's EMA fluctuations range actively expands downwards, and the histogram of the AO oscillator increases in the sell zone.

 

[SOLIDECN]

The shares of Meta Platforms Inc., which owns the world's largest social network Facebook, are trading within a downtrend around 183.

On the daily chart of the asset, a global Triangle pattern is forming with local extremums at 217 and 173, which is a trend continuation pattern, and the breakdown of its lower limit is the most likely scenario now. On a four-hour chart, the trading instrument completes the formation of another downward wave, and after the quotes break the support line at 176, the global decline may continue.

Technical indicators confirm the high probability of negative dynamics reversing downwards: fast EMAs on the Alligator indicator began to move away from the signal line, and the AO oscillator histogram is forming bars with a downward trend in the sell zone.

​

 

[SOLIDECN]

The shares of The Home Depot Inc., the world's largest home improvement company, are actively declining, trading around 302.

On the daily chart of the asset, a global downtrend is forming, within which the price is holding above the resistance line of the first stage of correction, forming a channel with dynamic boundaries 279–317. On a four-hour chart, it can be seen that the downwards channel is a slowdown stage for the global decline, the continuation of which may lead to a change in trend and the price reaching a local maximum at 339.

Technical indicators began to weaken the sell signal: the range of fluctuations of the EMA on the alligator indicator is actively narrowing, and the histogram of the AO oscillator is forming rising bars, quickly approaching the transition level.

 

[SOLIDECN]

The shares of Alibaba Group Holdings Ltd., one of the largest companies in the world in the field of Internet commerce, are correcting, trading at 92. On the daily chart, a wide downwards channel with dynamic boundaries 70–100 is formed, within which the price is held for a long time near the resistance line, unsuccessfully trying to break it.

On the four-hour chart, the local Triangle pattern is formed, the upper border of which coincides with the resistance line of the global channel around 100.

At the moment, there is no clear signal from the indicators for the subsequent movement yet but, given the factor of the pattern, the growth potential prevails: fast EMA on the Alligator indicator is actively approaching the signaling line, and the histogram of the AO indicator forms upward bars.

 

[SOLIDECN]

The shares of Caterpillar Inc., the world's leading manufacturer of construction and mining equipment, are trading in a corrective trend around 217.00.

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.

 

[SOLIDECN]

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.

 

[SOLIDECN]

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.

 

[SOLIDECN]

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

 

[SOLIDECN]

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.​

 

[SOLIDECN]

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 173.00, 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.

 

[SOLIDECN]

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.

 

[SOLIDECN]

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.

 

[SOLIDECN]

The shares of PayPal, a debit payment processor, 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]

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.