Current trend

Shares of Caterpillar Inc., a manufacturer of construction and mining equipment, are correcting to a long-term uptrend. Last week, the price broke through the negative part of the Murrey trading range and is currently actively testing 328.12 (Murrey level [2/8]), consolidation below which will allow it to reach the area of ​​312.50 (Murrey level [0/8]) and 296.88 (Murrey level [–2/8]). In case of a breakout of the central mark of the trading range 343.75 (Murrey level [4/8]), supported by the middle line of Bollinger bands, a resumption of growth to the area of ​​359.38 (Murrey level [6/8]) and 375.00 (Murrey level [8/8]) is expected.

Technical indicators confirm the formation of a downward trend: Bollinger Bands are turning down, and the MACD histogram is increasing in the negative zone. Stochastic is leaving the oversold zone, which does not exclude limited growth.

Support and resistance

Resistance levels: 343.75, 359.38, 375.00.

Support levels: 328.12, 312.50, 296.88.

Trading tips

Short positions may be opened below 328.12, with the targets at 312.50, 296.88 and stop loss 339.00. Implementation period: 5–7 days.

Long positions may be opened above 343.75, with the targets at 359.38, 375.00 and stop loss 333.00.