Technical Analysis ASX 200 : 2019-03-27
There is severe flooding in the Midwestern United States, which can damage cereal crops. Will oat prices rise?
Because of the severe flooding on the Missouri River, crops in Montana, North Dakota and Nebraska may be damaged. However, it should be noted that the European Union, Russia and Canada are the world leaders in oat production. The United States is the largest importer of this type of grain, while China and Mexico are in the second and third places.
On the daily timeframe, OATS: D1 breached up the resistance line of the falling channel and the 200-day moving average line. A number of technical analysis indicators formed buy signals. The further price increase is possible in case of a reduction in world harvest.
The Parabolic Indicator gives a bullish signal.
The Bollinger® bands have narrowed, which indicates low volatility. The upper Bollinger band is titled upward.
The RSI indicator is above 50. It has formed a positive divergence.
The MACD indicator gives a bullish signal.
The bullish momentum may develop in case OATS exceed their last high at 281.5. This level may serve as an entry point. The initial stop loss may be placed below the two last fractal lows, the lower Bollinger band, the 200-day moving average line and the Parabolic signal at 258.5. After opening the pending order, we shall move the stop to the next fractal low following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level (258.5) without reaching the order (281.5), we recommend to close the position: the market sustains internal changes that were not taken into account.
Summary Of Technical Analysis
Position | Buy |
Buy stop | Above 281.5 |
Stop loss | Below 258.5 |
Market Overview
US stocks close higher
Dollar weakening stalls despite soft data
US stock market resumed advancing on Tuesday led by energy and financial shares. The S&P 500 rose 0.7% to 2818.46. Dow Jones added 0.6% to 25657.73. The Nasdaq gained 0.7% to 7691.52. The dollar weakening stalled despite soft data indicating housing starts in February declined compared with the same period last year, and S&P/Case-Shiller 20-city home prices index growth was slower in January compared with December. The live dollar index data show the ICE (NYSE:ICE) US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, rose 0.3% to 96.74 and is higher currently. Futures on US stock indexes indicate higher openings today.
CAC 40 Outperforms European Indices On GDP Upgrade
European stocks recovered all of previous session losses on Tuesday. The EUR/USD joined GBP/USD’s continued slide with both pairs lower currently. The Stoxx Europe 600 rose 0.8%. The German DAX 30 gained 0.6% to 11419.48, France’s CAC 40 rose 0.9% as Q4 GDP final reading was upgraded to 1% over year. UK’s FTSE 100 advanced 0.3% to 7196.29 as parliament adopted an amendment on Brexit allowing it to set a timetable for debate and subsequent Brexit votes.
Shanghai Composite Leads Asian indices Gains
Asian stock indices are mixed today. Nikkei lost 0.4% to 21378.73 with yen little changed against the dollar. Chinese stocks are higher despite a report China’s industrial profits dropped sharply in the first two months of the year: the Shanghai Composite Index is up 0.9% and Hong Kong’s Hang Seng index is 0.6% higher. Australia’s All Ordinaries Index added another 0.1% as the Australian dollar turned lower against the greenback.
Brent Higher
Brent futures prices advance continues today. The American Petroleum Institute late Tuesday report indicated US crude inventories rose unexpectedly by 1.9 million barrels last week and gasoline inventories dropped by 3.5 million. Prices ended higher yesterday. May Brent added 1.1% to $67.97 a barrel on Tuesday. Today at 16:30 CET the Energy Information Administration will release US Crude Oil Inventories.