Market Analysis

Is BASF’s profit warning a bad sign for the economy as a whole?

BASF, the German chemical group headquartered in Ludwigshafen am Rhein, is the world’s largest chemical group in terms of sales and has issued a profit warning. Investors are becoming increasingly nervous, since the company’s products supply so many industries, worldwide. Because of the breadth of BASF’s customers and the worldwide networking of the company’s sales channels, some investors say that this company can accurately reflect the global economic situation. Is the trade war already beginning to have an impact? The second question that could follow would be whether the planned easing of monetary policy in some countries could come to nothing.

The BASF share started yesterday’s trading with a deep minus of more than 5%. In the course of yesterday’s trading, the stock recovered somewhat and closed above the €60 mark.

If the bulls do not rate the profit warning and drive the price further upwards, the first structural resistance could wait at €62.30. If the bulls then push the market further up, there could be structural resistance in the areas at €64.68, €66.56 or the lower edge of the gap on May 6th this year at €68.21.

However, if the bears push the market down, then the first structural support may be in the €67 area. If the market falls through here and shows lower prices, then the zones at €55.16 or 52.78 could support the market. If the bears then continue to drive the market further down, the zone in the €49 area could offer further support.

The MACD oscillator showed a bearish cross with yesterday’s low gap, but this has not yet been confirmed. The MACD line has crossed its trigger line from up to down. The histogram is sitting on its zero lines.


BAS.GE - daily chart. Source: ActivTrader

BAS.GE – Daily Chart | Source: ActivTrader


Written by Daniel Schuetz, External Analyst, ActivTrades

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