Global stock markets have stabilized today. This after yesterday's sales route, fueled by the fear of the potential economic hit that could cause an expanding coronavirus outbreak in the world's financial markets. Nevertheless, some sectors continue to collapse: holiday travel and container transport are under particular pressure
Unsurprisingly, as the epidemic has surfaced more aggressively outside of China in recent days, it has weighed on all types of transport-related supplies, including both travel companies and freight carriers.
The iShares Transportation Average ETF (NYSE 🙂 moves within a tight triangle (similar to the SPDR S&P Transportation ETF, XTN, discussed yesterday). There is pressure from the supply zone (light blue rectangle) and a prominent bearish divergence in RSI. The two closest support levels below the triangle are 175 and 165.
The primary interests of the ETF are divided as follows: shares of ground freight and logistics companies, 53.83%; stocks of airfreight and courier services, 19.42%; while 17.73% are airlines (including United Airlines Holdings (NASDAQ: UAL), which was also featured in yesterday's post), 17.73%.
However, some companies are out of their fault in the epicenter of events. Since February 12, when the Japanese health ministry announced that the Diamond Princess, a cruise ship that then docked in Yokohama, had 175 people infected with the virus (three have since died), cruise operators were immediately dumped by investors. That ship, owned by the Carnival Corporation (NYSE :), remains under quarentine, but other loyal segments of the segment are & # 39; infected & # 39; hit.
For example yesterday, Royal Caribbean Cruises (NYSE:) broke below the bottom trend line of the ascending triangle. If the monthly and weekly candles close below this line, it could be lower to the demand zone and support line of 67-70. The RSI shows a strong bearish divergence, which broke below the support line yesterday (blue). That is another bearish signal for the shares.
MAERSK (CSE :), the Danish transport, logistics and energy conglomerate, is the largest container ship and transport company in the world.
Since the record high of 15.860 DKK in March 2015, the company's stock has been ravaged. It has fallen 56% and is now testing the demand zone (between 6,000 – 7,000) that was set in 2011 (upper blue rectangle). Another historic support line is in this zone, at 6,600. If these assisted areas give in to the strong bearish momentum, the next demand zone will wait between 4,400 and 5,500.
On the monthly chart, the RSI keeps above the upward line (blue), but on the weekly chart, the oscillator is broken below the line, a sign of additional weakness for the stock.
