Burgers Doing Better Than Coke: McDonald's Shares Soar as Coca-Cola Drops

Fundamentals

Yesterday, the US consumer sentiment numbers we spoke about were released at 2 PM GMT. They were below expectations, at 120.30 vs the forecast of 123.70. At the same time, the number of March new home sales was released. Sales topped expectations at 621,000, far better than the forecast of 583,000.
Today, the US EIA releases its usual crude inventory report at 2:30 PM GMT. Weekly crude stocks are expected to be 1,300M barrels. Meanwhile, retails sales are being released in Canada at 12:30 PM GMT. February retail sales are expected to drop by 0.3%.

Stocks

A number of US multinationals reported their earnings yesterday.
Coca-Cola fell short of expectations, with an EPS of $0.43 vs the forecast of $0.44. It should be noted both the company’s gross and net profit fell. From Q1 to the end of 2016, Coca-Cola's net profit fell from $1483B to $550M. At the same time, the company's liabilities also shrank.
McDonald's EPS rose to $1.47 on earnings of $5.68B. With such a strong report, McDonald's shares skyrocketed. Technically, they went above the upper Bollinger band, which means the price may return to the previous range and, in the long term, to $132.
Today, giants such as Boeing, Procter and Gamble, and NASDAQ are publishing their reports.
The US stock market kept on rising for the second trading session in the row Tuesday. The Dow Jones Industrial Average started its trading day with a gap up. Technically, going long on the DJIA is becoming risky. The index went above the upper Bollinger band, so, like McDonald's, a correction is quite likely.

Currency Market

The EUR/JPY pair reached the target 121 yen per euro, just as we predicted. Traders are more than optimistic, with the MAs heading up. However, the Williams %R has entered overbought territory, which means the pair may correct downwards. In terms of wave theory, further price movement will depend on the previous wave. Since the current correction wave may be over, a new euro impulse wave might form.
The bulls succeeded in pushing EUR/CHF out of the flat range. The pair headed up, forming a gap up on the daily charts. The basic stochastic oscillators have entered overbought territory, which signals an imminent reversal. The resistance might be at $1.0980, which is a 61.8% Fibo retracement. If there is a correction, the pair may drop to 1.0750.

Nikolay Dudchenko, Olymp Trade Analyst

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