Current trend

Shares of Caterpillar Inc., a global manufacturer of construction and mining equipment, are moving within a long-term upward channel. At the end of last month, the price reached 296.88 (Murrey level [3/8]), from which a corrective decline began. Currently, the quotes are testing the reversal level of 281.25 (Murrey level [2/8]), consolidation below which will cause the development of negative dynamics to 265.62 (Murrey level [1/8]) and 250.00 (Murrey level [0/8], lower limit ascending channel), however, if it consolidates above the key “bullish” level at 296.88, growth will resume to 312.50 (Murrey level [4/8]) and 328.12 (Murrey level [3/8]).

Technical indicators do not give a single signal: Bollinger Bands are horizontal, MACD histogram is decreasing in the positive zone, and Stochastic is reversing downwards from the oversold zone.

Support and resistance

Resistance levels: 296.88, 312.50, 328.12.

Support levels: 281.25, 265.62, 250.00.

Trading tips

Long positions may be opened above 296.88 with the targets at 312.50, 328.12 and stop loss around 287.00. Implementation time: 5–7 days.

Short positions may be opened below 281.25 with the targets at 265.62, 250.00 and stop loss around 293.00.