Technical Analyst, Saxo Bank
ASML gapped lower but opened right at the key support level of EUR 858.10 following this morning's earnings announcement. The stock dipped to 855.10, mirroring the drop seen on 19th March, but subsequently, buyers have pushed it up by a couple of percent. 855.10 seems to be a pivot point for buying and selling control.
If ASML closes below 855.10 daily, it is likely to face selling pressure, potentially dropping to around 825-811. Should it close below 811, the selling could intensify down to strong support level at 760.
For ASML to resume an uptrend, it needs to close the gap formed this morning, i.e., a daily close above 898.60 is required. However, to confirm the uptrend, a daily close above 925 is necessary. Nonetheless, this would not negate the top and reversal Dark Cloud cover formed on 8th March; a close above the peak at 958.40 is essential to cancel that.
The strength indicator RSI has been declining while the share price has continued to climb, indicating a divergence or market imbalance that warns of potential trend exhaustion. If ASML closes below 855.10 and the RSI drops to close below the 40 threshold, a downtrend is confirmed.
On a medium-term basis, as seen on the weekly chart, the technical picture is somewhat unclear. The RSI still indicates positive sentiment without divergence. However, the strength indicator is moving below its rising trend line. If the RSI drops below the 60 threshold combined with ASML closing below 855.10, a larger sell-off could be triggered.
The pivot level of 855.10 remains crucial.
For an analysis on the AEX Index Technical analysis AEX25 testing key support CAC40 and SMI20 in downtrends
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