Indices Updates by Solid ECN

[SOLIDECN]

DAX30, Germany's energy sector faces new challenges​

The key news for the market is the statement of the President of the Russian Federation Vladimir Putin, who instructed to convert all payments for natural gas supplies into rubles as soon as possible, and for the first time, the new technology will be tested in Europe. It will create some difficulties for buyers. According to German Economy Minister Robert Habeck, although the country considers such a decision to be a violation of contractual obligations, it is still impossible to refuse gas supplies from Russia. Later, the head of the Bundestag Committee on Economics and Energy, Klaus Ernst, noted that it is technically possible for Germany to pay for fuel in Russian rubles but this forces energy consumers to bypass their own sanctions restrictions, which is not entirely logical.

On the global chart, the price moves within the correction to the previous decline. Technical indicators keep a sell signal, which has almost been cancelled: indicator Alligator’s EMA fluctuations range narrowed almost completely, and the histogram of the AO oscillator reached the transition level.​

• Resistance levels: 14555, 15350.​
• Support levels: 14000, 12600.​

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[Solid ECN]

FTSE 100, UK stock market is strengthening​

The British stock market was supported by yesterday's macroeconomic statistics, according to which the composite index of business activity for March was 59.7 points, which exceeds the analysts' forecast of 58.7 points. The index of business activity in the UK services sector rose to 61.0 points from 60.5 points earlier.

In addition, it is worth noting the period of stabilization in the UK bond market, where 10-year treasury securities were fixed in the region of the highs of the year at the level of 1.638%. In turn, the yield on 20-year conservative bonds reached 1.894%, which is somewhat inferior to 1.957% at the beginning of the week.

The growth leaders in the index are Polymetal International Plc. (+20.73%), Fresnillo Plc. (+5.73%), M&G Plc. (+2.45%). Among the leaders of the decline are Next Plc. (-3.26%), Ferguson Plc. (-3.25%), Schroders Plc. (-3.14%).

Support and resistance
Index quotes continue to trade within the global Expanding Formation pattern. Technical indicators are in a stable buy signal state: the range of EMA fluctuations on the Alligator indicator expands in the direction of growth, and the histogram of the AO oscillator is forming new ascending bars in the purchase zone.​

• Support levels: 7384, 7020.​
• Resistance levels: 7520, 7800.​

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[Solid ECN]

Pfizer Inc, upward trading dynamics​

The shares of Pfizer Inc., one of the world's largest pharmaceutical companies, continue to rise above 52.00.

The corporation has completely closed the deal to buy the American pharmaceutical company Arena Pharmaceuticals Inc. for 6.7B dollars. The main reason for the new acquisition is the receipt by the issuer of Arena Pharmaceuticals Inc.'s development in the field of gastroenterological drugs. According to preliminary estimates, the financial component of the new partnership will be included in the next report, which will be published on May 3.

Analysts forecast a continuation of a stable increase in profit within the limits of 24.89B dollars, which significantly exceeds the 23.84B shown a quarter earlier. Earnings per share are expected to be around $1.6, which could be the highest in the company's history. On March 4, the last payment of quarterly dividends took place, which was increased to $0.4. The Board of Directors will discuss the date and amount of upcoming payments yesterday, the publication of the May report.
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The asset moves in a global corrective trend, pinching within the local Triangle pattern. Technical indicators are in the state of a global buy signal and are working out the local correction: fast EMAs of the Alligator indicator are moving above the signal line, and the AO oscillator histogram is trading above the transition level, forming downward bars.

Resistance levels: 54.5, 59 | Support levels: 51, 45.5​

 

[Solid ECN]

Dow Jones, the US stock market is preparing for a new decline​

The US stock market is declining again, the reason for which was the technology sector, whose shares are seriously getting cheaper. Thus, Advanced Micro Devices Inc. stocks lost more than 5.6% due to the negative forecast of Barclays experts and the change of the recommendation to negative. In turn, the quotes of HP Inc. and Dell Technologies Inc. are losing 7.6% and 7.4%, respectively, after Morgan Stanley analysts lowered their forecast for the purchase of shares of these companies.

The US bond market is showing local growth. Thus, the yield rate on 10-year US Treasuries increased by 2.62% and by 1.90% on conservative 20-year securities. Short-term bonds are also rising. The rate on annual treasury securities increased by 1.77%, and on 6-month — by 3.50%.

At the moment, there is not a single company showing growth in the index, and among the least losing in price are Caterpillar Inc. (-0.12%), Amgen Inc. (-0.31%), Coca-Cola Co. (-0.34%), Merck&Co. (-0.42%).

The leaders of the decline are Walgreens Boots Inc. (-5.67%), Intel Corp. (-3.71%), JPMorgan Chase & Co. (-3.00%).
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The index quotes continue to trade inside the descending channel, having reached the resistance line the day before. Technical indicators are ready to reverse and issue a sell signal: the fast EMA of the alligator indicator began to actively approach the signal line, and the histogram of the AO oscillator formed the first descending bar.

Support levels: 34327, 32540 | Resistance levels: 35260, 36410​

 

[Solid ECN]

Walmart Inc, general overview​

The stocks of the American company that manages the world's largest wholesale and retail chain, Walmart Inc., are trading at 149.

Earlier, it was announced that it intended to hire an additional 50K employees in the USA in the current quarter, which could put serious pressure on profitability, since the company pays hourly wages, which have increased by more than 5.5% since the beginning of 2022, and the growth trend continues. According to preliminary estimates, labor costs may increase by 15% in 2022, which will negatively affect the indicators.

As for the dividends, the next payment is scheduled for April 4, when investors will receive 0.56 dollars per share. The closure of the registry has already taken place on March 17. It was also reported that the annual shareholders' meeting will be held on June 1, 2022, and it may consider further raising the amount of dividends to 2.30 dollars per share for the year.
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The asset continues to move within the global corridor, which shows signs of local decline. After reaching the resistance line, the price is preparing to start forming a reversal. Technical indicators still continue to hold the buy signal: the histogram of the AO oscillator is trading in the buy zone, and the fast EMA on the alligator indicator is above the signal line.

Resistance levels: 151, 160 | Support levels: 147, 135.​

 

[Fried_Rice]

Wow, an extra 50k workers is a serious increase, pressure on profitability will indeed be strong. Not a stock I trade, but my money would be on the downside

 

[Solid ECN]

Visa Inc technical analysis​

The shares of Visa Inc, America's largest multinational payment services company, are trading at 225. On the daily chart of the asset, a global Expanding formation pattern is developing, within which the fifth wave is forming, directed towards the resistance line around 256.

On the four-hour chart, the instrument has already broken the resistance line of the global downtrend at 213 and confidently consolidated above it. It indicates a high probability of continued growth of quotations if they break the local year's high, around 235.00. At the moment, indicator Alligator's EMA fluctuations range is expanding in the direction of growth, and the histogram of the AO oscillator is trading in the buying zone.​

 

[Solid ECN]

Nikkei 225, Japanese stock market remains under pressure​

The pressure on the Japanese stock market continues to be exerted by the growing geopolitical tension, which has already caused an increase in energy prices. One of the leading indicators of business confidence in Japanese industry, the Tankan index, fell from 17 to 14 points in Q1 2022. This means that large manufacturers' confidence in the national economy has significantly decreased, which is also confirmed by the decline in the sentiment index of large non-manufacturing companies, which amounted to 9 points, down from 10 points a quarter earlier.

The main factor behind the downtrend of the stock market in Japan is the negative trend in the domestic bond market. The yield on 10-year bonds decreased by 1.86% compared to the values at Friday's close, and on conservative 20-year bonds it decreased by 2.12%. The most serious drop, however, is observed in short-term securities: 2-year government bonds lose 22.06% of their value at the moment.​

Support and resistance
On the global chart, the price continues to trade within the descending channel, being near the resistance line. Technical indicators maintain a slightly weakening buy signal: the histogram of the AO oscillator is deep in the buy zone, and the fast EMAs on the Alligator indicator are above the signal line.​

 

[Solid ECN]

Adobe Inc, the decline in the horizontal range may resume​

Adobe Inc. stocks have been trading in a downtrend since November last year, but the price has spent the last two months in a sideways range of 468.75-406.25 (Murray [3/8]-[1/8]), which was caused by increasing geopolitical uncertainty due to the start of a special military operation in Ukraine.

In early March, the company announced the termination of sales of new products and services in Russia and Belarus, and later the management of Adobe Inc. lowered the forecast of profit growth for the 2022 fiscal year by 87M dollars, to 4.34B dollars. Analysts believe that the fighting will lead to the termination of the implementation of the company's developments in the European region as a whole, and not only in countries that have fallen under sanctions, which explains the likely drop in profits. Nevertheless, the current financial performance of the company looks encouraging, which constrains the decline in quotations. In particular, in Q1 2022, the issuer's net profit amounted to 1.266B dollars, which is higher than in the same period a year earlier, while revenue was fixed at 4.36B dollars, an increase of 9% compared to last year.



Support and resistance
Technically, the price rose to the level of 468.75 (Murray [3/8]), but it could not break through it and began to decline, the targets of which are 437.5 (Murray [2/8], the middle line of the Bollinger Bands) and 406.25 (Murray [1/8], the lower line of the Bollinger Bands). If the asset consolidates above 468.75 and the middle line of the Bollinger Bands (475.00), the upward dynamics may continue to the levels of 500.00 (Murray [4/8]) and 531.25 (Murray [5/8]).

Technical indicators do not give a single signal: the Bollinger Bands are directed horizontally, the Stochastic reverses down from the overbought zone, but the MACD histogram decreases in the negative zone.

Resistance levels: 475, 500, 531.25 | Support levels: 437.5, 406.25.

 

[Solid ECN]

CAC 40, EU markets are trying to recover​

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The French bond market, which is trading in different directions, continues to have a key influence on the dynamics of the indices. Yields on 10-year bonds are down 0.45% and conservative 20-year bonds are up 0.39%, while short-term half-year bonds are down 1.16% and 3-year bonds are down 5.17%.

Meanwhile, in the corporate segment, the fundamental background is not too positive. Sodexo SA, an office services company, confirmed that its key financials forecast will remain at the lower end of the target range, causing the issuer's shares to fall more than 11%.

On Friday, May 6, the Euroapi division, spun off from the pharmaceutical giant Sanofi SA, will start trading on the Paris Stock Exchange.


The quotes of the asset are traded as part of a global downtrend, rising in the direction of the resistance line. Technical indicators are holding a local buy signal: the range of EMA fluctuations on the Alligator indicator started expanding in the direction of growth, and the histogram of the AO oscillator is trading in the purchase zone while forming local ascending bars.

Support levels: 6533, 5880 | Resistance levels: 6800, 7320​

 

[Solid ECN]

S&P 500, the US market is correcting​

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The US stock market continues to evaluate the recent revision of financial forecasts from leading analytical agencies. The day before, analysts at UBS Group AG raised the target price of Meta Platforms Inc. shares for Q2 2022 from 280 to 300 dollars. In turn, Chevron Corp., according to UBS Group AG estimates, will rise from 150 to 192 dollars. Prior to this, Goldman Sachs Group analysts also raised their forecast for the issuer's shares.

The US bond market is currently experiencing active growth: the rate of return on 10-year Treasury bonds rises by 2.44% and by 1.89% on conservative 20-year ones. More dynamic growth is traditionally demonstrated by short-term assets: annual bonds grow by 2.55%, and 6-month bonds rise by 4.26%.



The index quotes are traded in a local uptrend, having overcome the resistance line of the lateral channel the day before. Technical indicators are holding a local buy signal: fast EMAs on the Alligator indicator are above the signal line, and the AO oscillator histogram is in the buy zone.

Support levels: 4470.0, 4216 | Resistance levels: 4630, 4800​

 

[SOLIDECN]

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European stock markets are again in the "red" zone under the pressure of weak macroeconomic reporting. The volume of Industrial Orders in Germany in February decreased by 2.2% after an increase of 2.3% a month earlier. Among the main reasons for the negative dynamics is the fall in external demand from other eurozone states.

In the corporate segment, the largest automaker Volkswagen AG VZO announced plans to reduce the supply of cars with gasoline and diesel engines in Europe by 60%. The company said it had to revise its strategy after production faced a severe semiconductor shortage and rising nickel prices.

Another reason for the pressure on the German stock market is the refusal of the EU countries to import Russian coal as part of the sanctions policy against the backdrop of the continuation of the military conflict in Ukraine. According to experts, this step could seriously undermine the production activity of enterprises and call into question energy security.



On the global chart of the asset, the price is traded as part of a correction to the previous decline. Technical indicators are reversing again and are ready to give a sell signal: the fluctuation range of the Alligator indicator EMAs started expanding towards decline and the histogram of the AO oscillator is approaching the transition level.

Support levels: 13850, 12600 | Resistance levels: 14510, 15341​

 

[Solid ECN]

Nasdaq 100, US Fed's "hawkish" policy holds back stock market growth​

Serious pressure on the US stock market was exerted by the minutes of the meeting of the Federal Open Market Committee of the US Federal Reserve (FOMC) published yesterday. According to the document, most of the participants in the meeting would have preferred to raise the rate by 0.50% already in March against the backdrop of high inflation, but as a result, the indicator was corrected by a minimum amount of 25 basis points. Also, the regulator confirmed plans to reduce the balance sheet by 95B dollars per month. According to forecasts, the agency is ready to start a quantitative increase and increase the rate by 50 basis points at once in May.

This week, traders were on the lookout for reports that investment firm Berkshire Hathaway Inc. has purchased an 11.4% stake in the American manufacturer of personal computers and printing equipment HP Inc. The deal amounted to 4.2B dollars.
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The index quotes have left the limits of the narrow downward channel and are forming a global Head and shoulders reversal formation. Technical indicators give a poor signal to buy: indicator Alligator's EMA fluctuations range is still quite wide, and the AO oscillator histogram forms downward bars in the buy zone.

Resistance levels: 15150, 16387 | Support levels: 14225, 13070​

 

[Solid ECN]

ASX 200, Australian bond market continues to rise​

The leading index of the Australian economy, ASX 200, is strengthening, being near 7477.0. The Australian stock market is trading ambiguously due to a poor Friday report on economic stability and growth in the bond market.

Thus, the Reserve Bank of Australia announced the growing uncertainty regarding the development of the national economy, caused primarily by the continuing rise in inflation. Officials said they were closely monitoring the dynamics of household mortgage debt and lending and warned borrowers that they should be prepared for higher interest rates. According to department representatives, the country's financial system remains stable, and financial institutions are well-capitalized. However, inflation will continue to rise in the future, putting serious pressure on both borrowers and consumers.

The stock market is not allowed to fall by the bond market, which continues to grow actively. Today, the yield of popular 10-year bonds of Australia added 1.96%, while the rate of return on conservative 20-year bonds is 1.78%. Short-term assets show a more restrained trend: 1-year securities rose by 1.68%, and 2-year securities added 0.89%.



The price moves within the global Expanding formation pattern, approaching the resistance line. Technical indicators keep a stable buy signal: fast EMAs of the Alligator indicator are above the signal line, and the AO oscillator histogram is high in the buying zone.

Support levels: 7380, 6980 | Resistance levels: 7550, 7750​

 

[Solid ECN]

The Dow Jones is correcting down and trading at $34,180.​

The corporate reporting season starts this week with the publication of data by companies in the banking and insurance sectors. Despite the fact that the stock market is trading at its highs, strong financial results should not be expected during this period, and if the figures are higher than predicted, this will probably not affect the long-term plans of issuers.

The bond market is also showing historical growth, so a serious influx of money into stocks is not expected. The yield on popular 10-year US Treasuries updated the record of 2019 and amounted to 2.826%, while conservative 20-year bonds overcame the figure of 3.040% the day before. Short-term bonds are the fastest rising, adding 3.85% and 5.67% for 3-month and 6-month notes, respectively.
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The index quotes are traded inside the descending channel, having reached the resistance line and reversed from it. Technical indicators are about to change direction and give a sell signal: fast EMAs on the Alligator indicator are approaching the signal line, and the AO oscillator histogram is actively forming downward bars.

Support levels: 33,860, 32,550 | Resistance levels: 34,820, 35,870​

 

[Solid ECN]

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The FTSE 100 index shows a local corrective trend, trading at 7574.0.​

Corporate news is beginning to come to the fore in stock markets around the world, as the period for publishing the financial results of index component companies kicks off next week. The budget carrier EasyJet Plc. reported that the revenue forecast suggests a loss of around 500 million pounds due to low overall bookings. In turn, the shares of the online retailer ASOS Plc. strengthened marginally after maintaining the company's strong growth forecast for 2022, despite an expected drop in first-half earnings due to supply issues.

In addition, the continued growth in the UK bond market should be noted, where 10-year treasuries renewed another high, reaching 1.8080%, and the yield on 20-year conservative bonds increased to 2.021%, which significantly exceeds 1.741% at the beginning of the month.

The growth leaders in the index are British Petroleum Plc. (+2.40%), Fresnillo Plc. (+2.30%), JD Sports Fashion Plc. (+2.18%). Among the leaders of the decline are Rolls-Royce Holdings Plc. (-5.48%), Land Securities Group Plc. (-4.53%), Ocado Group Plc. (-4.32%).



Index quotes are trading within the global Expanding Formation pattern. Technical indicators are in a stable buy signal state: the range of EMA fluctuations on the Alligator indicator stays wide and the histogram of the AO oscillator is trading high in the purchase zone.

Support levels: 7500, 7232 | Resistance levels: 7673, 7900​

 

[Solid ECN]

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The shares of Tesla Inc., the world's leading manufacturer of electric cars, continue their global correction, trading at 1022.

On the daily chart, the trading instrument is within the global Expanding formation pattern, which began to implement in October 2021. At the moment, the price has completely formed its sixth wave, having reached the resistance line at 1146, and reversed downwards.

On the 4-hour chart, there are signs of a new downward wave, with the target at the support line of the pattern around 760. The readings of technical indicators also confirm the likely continuation of the decline: fast EMAs on the Alligator indicator are actively approaching the signal line, and the AO oscillator histogram is forming bars with a downward trend in the buying zone.

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[Solid ECN]

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Against the backdrop of the start of the corporate reporting period, corporate news comes to the fore for stock indices. ArcelorMittal SA announced that it intends to acquire a majority stake in the Austrian steel company Voestalpine AG. The preliminary amount of the deal is estimated at 1 billion dollars. The day before, Hermes International SA published its financial results, according to which the quarterly revenue exceeded 3.10 billion euros, and the growth compared to the previous quarter was 33%, thanks to an increase in sales in all segments.

The rally that began in the French bond market in March of this year is continuing now, with popular 10-year bonds yielding 1.334%, up from 0.350% in early March, and conservative 20-year bonds hitting 1.628%, the last time observed at the beginning of 2017.



The quotes of the asset are traded as part of a global downtrend, rising in the direction of the resistance line. Technical indicators are holding a local buy signal: the range of EMA fluctuations on the Alligator indicator is about to start expanding in the direction of growth, and the histogram of the AO oscillator is trading in the purchase zone while forming local ascending bars.

Support levels: 6420, 5880 | Resistance levels: 6800, 7150​

 

[Solid ECN]

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The corporate reporting period in Japan started with the publication of financial results of real estate companies. So, the investment company Daiwa House REIT Investment Corp., Ltd. showed quite strong results: revenue was recorded at around 30.26B yen, surpassing 29.57B yen in the previous quarter. In turn, Mitsubishi Estate Logistics REIT Investment Corp. reported revenue of 5.03B yen, which was also higher than the 4.95B yen shown in the previous quarter. LaSalle Logiport REIT showed revenue of 10.59B yen, which was better than the projected 10.55B yen.

In the domestic bond market, the situation began to stabilize after the global downtrend changed last week. Thus, the yield on 10-year Japanese treasuries lost 1.26% relative to Friday's close, while conservative 20-year bonds rose by 2.19%, and global 30-year bonds — by 3.11%.

On the global chart of the asset, the price remains within a wide descending channel, moving in the direction of the resistance line. Technical indicators are in a state of uncertainty: the histogram of the AO oscillator is close to the transition level, forming descending bars, and the fast EMAs on the alligator indicator are below the signal line.

Support levels: 26175, 24681 | Resistance levels: 27386, 28506​

 

[Solid ECN]

The shares of Snap Inc, the US company that owns the Snapchat messenger, are trading at 32.

On the daily chart of the asset, a global downtrend continues to form, at the lows of which the price is clamped inside the Triangle pattern. There is not much time left before the figure's implementation, and if the quotes break the February low of 28, the downward scenario will receive the necessary confirmation.

The four-hour chart shows that a full-fledged correction has not yet begun, as the instrument has not consolidated above the initial Fibonacci 23.6% correction level of 41. At the moment, the upward dynamics seem unlikely since technical indicators confirm the increased activity of the "bears": fast EMAs on the Alligator indicator crossed the signal line downwards, and the AO oscillator histogram consolidated below the transition level, continuing to form downward bars.​