The market situation is very interesting. Spring came, brought warmth, and stock bears woke up in American high-tech stocks. Tesla (TSLA) shares fell more than 6% yesterday, below its key 50-day centerline and 30% below its 52-week high. Elon Musk, acting as the host of the satirical program, said that he has Asperger’s syndrome and this is probably important, but even more important is that quotes broke down a long-term upward trend yesterday. For the bulls, the jokes are over. I will not give any forecasts for this stock, I will just note that the purchase of these securities is fraught with risk, because since April 14 the quotes have been under a downtrend.
On Monday, the high-tech composite Nasdaq fell 2.55% and the S&P 500 lost 1%. I cannot say that the American stock market has gone into a deep correction, but if the S&P 500 breaks down the support zone of 3940-4000 and turns out to be below the uptrend, I would sell American stocks. This is still a long way off, but novice investors who entered the market in February may not realize that the S&P 500 is climbing for the fifth quarter in a row. During this time, it grew from the level of 2500 to 4188 points. The correction to large-scale growth will also be large-scale.
As for the domestic RTS index, since the beginning of the year it has formed an upward corridor and yesterday tested its upper limit. By the end of the day, the index fell by 0.43%. There is no panic in this regard, but I want to note that on the weekly chart, the RSI indicator did not confirm the last upward spurt of the index. I would also like to note that the RTS index has formed an upward corridor since the beginning of the year, while the MSCI Emerging Markets index has been moving in a sideways corridor since the beginning of the year.
There are no miracles happening to the Chinese stock market, whose dynamics strongly influence the emerging market index. It is approximately at the opening levels of the year (slightly below) In this regard, there are fears that buying domestic shares near the upper border of the RTS index’s upward corridor will not bring happiness to the bulls. As for the support, here it is at the level of 1400 and 1270 points.
The situation looks negative in the morning, but there are factors that soften the external negative. Investors are looking forward to a meeting between the leaders of Russia and the United States in June. They hope to ease geopolitical tensions. Joe Biden noted that there is no data on Russia’s involvement in the hacker attack on the Colonial Pipeline company. The American side is not interested in disrupting the June meeting. In addition, oil prices (Brent) continue to stay in an ascending channel with borders at 65.5-70.5 today.