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The short‑term Elliott Wave outlook for Dow Futures (YM) indicates that the Index has completed its correction against the cycle from the March 30, 2026 low and has resumed higher. The rally from that low is unfolding as a clear impulse. Within this structure, wave 1 terminated at 50,043, while the subsequent pullback in wave 2 found support at 48,608. From there, the Index extended upward in wave 3, which itself subdivides into another impulsive sequence.

Advancing from wave 2, wave ((i)) concluded at 50,292, as illustrated in the one‑hour chart. The pullback in wave ((ii)) then ended at 49,146, establishing a pivotal low. The Index has since resumed its ascent in wave ((iii)) of 3. From wave ((ii)), the internal wave (i) is expected to complete shortly. Following that, a corrective pullback in wave (ii) should unfold, addressing the cycle from the May 18, 2026 low before the rally resumes. This correction will provide the necessary consolidation for the next upward phase.

In the near term, as long as the pivot at 49,146 remains intact, any pullback should find support. The correction is likely to manifest in a 3, 7, or 11 swing sequence, consistent with Elliott Wave guidelines. The structure remains constructive, and the broader cycle favors continuation higher once the short‑term correction completes.

Dow Futures (YM_F) 60-Minute Elliott Wave Chart

YM_F Elliott Wave Video:

https://www.youtube.com/watch?v=Id3hOrOyUW8

Key insights from the week that was.

In Australia this week, the Westpac-MI Consumer Sentiment Index clawed back only a quarter of April’s collapse, rising 3.5% to 83.0. This leaves sentiment at a deeply pessimistic level, reminiscent of the scars inflicted by the post-pandemic cost-of-living shock. The halving of fuel excise provided some relief in May, facilitating an improvement in views around family finances – the ‘last 12 months’ and ‘next 12 months’ sub-indices rising 9.0% and 10.7% respectively. However, a third consecutive cash rate increase left 85% of consumers bracing for further increases in mortgage rates over the coming year. Adding in the uncertainty created by the seemingly open-ended Middle East conflict and anxiety over the tax changes proposed in the Budget, it is not surprising views on the economic outlook for one and five years hence sit at a combined three-and-a-half year low.

April’s labour force survey also points to an imminent slowing in economic momentum. Employment fell 18.6k, abruptly halting the uptrend that commenced early this year. The participation rate nudged 0.1ppt lower to 66.7%, but the unemployment rate still rose 0.2ppts to 4.5%, the highest reading since the ‘delta’ COVID-19 outbreak of late-2021. Some of the surprise can be explained by ‘abnormal’ seasonality around Easter and noise in youth outcomes, but genuine weakness is also evident just as the shocks associated with the Middle East conflict and 2026’s rate increases reverberate through the wider economy.

Aware of the volatility of labour data, like us the RBA will probably expect some degree of payback next month. This week’s data will give the RBA cause to pause in June. But we continue to expect them to raise the cash rate in August and September as energy costs are passed through and given their desire to keep inflation expectations anchored. The cash rate is then likely to remain on hold until 2028, when a return to near-target inflation will allow a reversal of this year’s rate hikes.

In the US, the minutes of the April FOMC meeting primarily focused on the outlook for inflation. There was a lengthy discussion of potential upside risks to inflation, with the Middle East conflict’s direct and indirect effect on prices, US tariffs and the strength of AI infrastructure investment all commented on. In contrast, participants were sanguine on the labour market, assessing there to be balance between labour demand and supply and limited downside risks. GDP growth was also expected to be solid this year, the staff forecasting momentum to hold just above trend. On policy, members indicated that, if they see evidence of disinflation being back on track or the labour market weakening, easing could be considered. A “majority of participants highlighted, however, that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2 percent”.

Over in Europe, Euro Area CPI inflation met expectations in April, prices rising 1.0% in the month, lifting annual inflation from 2.6%yr to 3.0%yr. Core inflation was elevated in the month, but remained close to the 2.0%yr medium-term target on an annual basis. Gains were broad-based across the different categories, but transport contributed the most. UK annual CPI inflation meanwhile moderated from 3.3%yr in March to 2.8%yr in April as prices rose 0.7% in the month. The deceleration in inflation came from several discretionary goods categories including clothing and furniture. Core CPI inflation rose 2.5%yr in the month, down from 3.1%yr in March. Comments from Bank of England Governor Bailey noted the monetary policy committee has time to assess the impacts of the war, having already effectively tightened by removing the expectations of a cut set at the start of the year.

Also in the UK, employment rose by 148k over the three months to March while the unemployment rate eased to 5.0% for the same period. While on the surface this may paint a rosy picture, signs of labour market softening are starting to emerge. The unemployment rate for March rose to 5.5% and the number of payrolled employees fell 100k in April. Wages growth excluding volatile bonuses moderated from to 3.4%yr from 3.6%yr previously and, for the private sector only, underlying wage growth is a considerably more modest 3.0%yr.

Turning to Asia, China’s partial indicators for April again highlighted a need for stimulus. Retail sales growth slowed sharply to 0.2%yr in April from 1.7%yr in March, a post-pandemic low, as reduced government subsidies weighed heavily on car and household appliance sales. Fixed asset investment fell 1.6%ytd driven by the private sector. Having improved in recent months, the decline in property investment accelerated again in April to -13.7%ytd. Industrial production growth also slowed from 5.7%yr to 4.1%yr in April, suggesting supply disruptions related to the Middle East are beginning to be felt. This is a risk for the entire Asian region for both activity and inflation, and a particular challenge for policy makers coming at a time of surging strength in tech-related production and investment.

Closing with the Middle East conflict. Iran has said the latest proposal from the US partly bridges the gap between the two sides, but comments from Supreme Leader Khamenei about keeping Tehran’s uranium stockpile and a dispute over tolls in the Strait of Hormuz suggests a deal remains some way off. President Trump also said he opposes efforts by Iran and Oman to establish some form of permanent toll system for the Strait of Hormuz: “We want it open, we want it free, we don’t want tolls”.

Key Takeaways

• Global equity markets extended their relief rally as optimism over a potential US-Iran peace agreement boosted risk appetite, triggering strong gains in Asian and US stock indices while crude oil prices continued to retreat.
• Japan’s softer-than-expected April inflation data reduced pressure on the Bank of Japan to tighten monetary policy aggressively, reinforcing Yen weakness and widening the policy divergence versus the hawkish Federal Reserve.
• Cooling bond yields and easing geopolitical tensions provided fresh support for growth and technology stocks, while improving labour relations at Samsung Electronics helped reduce concerns over semiconductor supply-chain disruptions.
• Chart of the day: Nikkei 225 kickstarts new bullish impulsive up move sequence towards new all-time highs above 61,955 key short-term support.

Top Macro Headlines

1. US-Iran peace deal reaches “in progress”: Global market sentiment shifted gear to “risk on” dramatically after Iran said the latest proposal from the US has partly bridged the gap between them, increasing the odds of a peace deal.
2. Japan April CPI cools to 4-year low: Japan's core consumer price index, which excludes fresh food but includes energy, rose 1.4% year-on-year in April, coming in softer than market forecasts of 1.7%. Also, the Bank of Japan’s preferred inflation data, the core-core CPI, excluding fresh food and energy, rose at a slower pace of 1.9% y/y versus 2.4% in March. This reading marked the lowest level since July 2024 and fell below the Bank of Japan's 2% target, largely due to government fuel subsidies offsetting the Iran war oil shock.

Key Macro Themes

• Geopolitical “risk on” volatility unlocked: Capital markets are actively pricing out the prolonged geopolitical risk premium. The temporary pause in Middle East military escalation has triggered immediate short-covering across multiple asset classes, especially boosting airlines and tech while tanking crude oil.
• Diverging central bank paths: While the Fed minutes signal potential rate hikes due to sticky US inflation, the Bank of Japan finds itself with renewed breathing room. Japan's unexpectedly soft 1.4% y/y core CPI and 1.9% y/y core-core CPI prints suggest less urgency for immediate aggressive tightening, despite the ongoing weakness of the Yen.
• The billion-dollar tech IPO thaw: Led by SpaceX seeking a $1.75 trillion public footprint and OpenAI moving into confidential prospectus filings, the multi-trillion-dollar tech listings boom is shifting structural market liquidity back toward equities.

Global Market Impact: Last 24 Hours

Equities: Global equities experienced a massive relief rally. Wall Street rallied for the second consecutive session, with a fresh all-time closing high seen in the Dow Jones Industrial Average. The energy sector lagged, down 1%.

Fixed Income: Sovereign bond yields pulled back, providing much-needed relief from the recent historic debt selloff. The benchmark US 10-year Treasury yield slid for the second consecutive session by 1 bps to 4.57%, and the longer-term 30-year yield fell by 3 bps to 5.09%.

FX: The US Dollar Index, DXY, traded almost unchanged on Thursday, 21 May, capped by renewed risk-on appetite. The Japanese Yen faced depreciation pressure following the softer-than-expected Japan CPI data, as it probed the 159.10/35 per USD level that may trigger verbal intervention.

Commodities: WTI and Brent crude oil saw losses for the second consecutive session, dropping by 1.1% and 0.2% on Wednesday, 21 May, as the geopolitical risk premium from the Middle East conflict evaporated on peace hopes. Meanwhile, spot Gold traded almost unchanged at $4,543/oz, below its 20-day moving average at $4,611/oz.

Asia Pacific Impact

• Stock markets: Benchmark Asia Pacific stock indices kick-start today’s session on a bullish footing, reinforced by overnight gains seen in the US stock market. Nikkei 225 rose 1.8%, Hang Seng Index gained 0.5%, KOSPI rose 0.5%, ASX 200 added 0.4%, and STI advanced 0.2% at the time of writing.
• Currencies and monetary policy: The Indonesian Rupiah caught a significant bid and strengthened after Bank Indonesia implemented an interest rate hike to defend the currency. Conversely, Japan's unexpectedly soft CPI data gives the Bank of Japan breathing room, further complicating efforts to defend the Yen from speculative short selling.
• Corporate and supply chain: Providing a major tailwind for regional tech, the Samsung union officially suspended its planned strike after reaching a tentative pay deal, easing severe risks to global semiconductor and memory supply chains.

Top 3 Events to Watch Today

1. UK Retail Sales (Apr) - 2.00 pm SGT; consensus: 1.3% y/y, Mar: 1.7% Impact: GBP/USD, GBP crosses, FTSE 100
2. US University of Michigan Consumer Sentiment Final (May) - 10.00 pm SGT Impact: USD, US stock indices
3. Updates on US-Iran peace deal Impact: All asset classes

Chart of the Day: Nikkei 225 En Route to Fresh All-Time High

Fig. 1: Japan 225 CFD minor trend as of 22 May 2026. Source: TradingView.

The recent bullish reversal seen on the Japan 225 CFD, a proxy of the Nikkei 225 futures, after a break below and a reintegration back above its 20-day moving average on Wednesday, 20 May 2026, has suggested that a new potential bullish impulsive up move sequence is underway towards new record highs.

Watch the 61,955 key short-term pivotal support to maintain the bullish bias. A clearance above the current all-time area of 63,270/788 sees the next intermediate resistances coming in at 65,010/040 and 66,190/558, Fibonacci extension clusters.

On the other hand, a break and an hourly close below 61,955 invalidates the bullish scenario, potentially leading to a minor corrective setback to retest the 20-day moving average at 60,985. Further weakness is possible, with potential to extend towards the next intermediate support at 59,048/58,574.

Key Highlights

• USD/JPY started a decent increase and reclaimed 158.00.
• A key bullish trend line is forming support at 158.50 on the 4-hour chart.
• EUR/USD extended losses and traded below 1.1620.
• USD/CAD is showing signs of strength above the 1.3750 resistance.

USD/JPY Technical Analysis

The US Dollar remained supported above 156.50 against the Japanese Yen. USD/JPY formed a base and started a fresh increase above 158.00.

Looking at the 4-hour chart, the pair above the 50% Fib retracement level of the downward move from the 160.72 swing high to the 155.03 low. The pair settled above 158.80, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour).

Besides, there is a key bullish trend line forming support at 158.50. On the upside, the pair faces resistance at 159.40 and the 76.4% Fib retracement level of the downward move from the 160.72 swing high to the 155.03 low.

The first major resistance sits at 160.00. A close above 160.00 could open doors for gains above 160.50. In the stated case, the bulls could aim for a move to 162.00.

If there is another decline, the pair could find bids near 158.50. The first major support sits near the 158.00 level. The next support could be 157.80 and the 100 simple moving average (red, 4-hour). A close below 157.80 might initiate a drop to 156.50. Any more losses might open the doors for a drop toward the 155.00 zone.

Looking at EUR/USD, the pair remained in a negative zone, and the bears could aim for a clear move below the 1.1550 support.

Upcoming Key Economic Events:

• Fed Chair Warsh Swearing-in Ceremony.
• Michigan Consumer Sentiment Index for May 2026 (Prelim) – Forecast 48.2, versus 48.2 previous.

Silver has endured a violent reversal in the past two weeks, swinging from near $90 to the mid-$70s as geopolitical panic surrounding the Iran conflict intensified and then eased sharply. The initial steep decline was fueled by fears of an imminent US strike on Iran earlier in the week and a potential collapse of the fragile ceasefire framework, which sent Brent crude above $111. But sentiment shifted quickly after the White House postponed the strikes, and signaled negotiations with Tehran were entering the “final stages”.

The more important story may be what did not happen. Despite intense liquidation pressure across commodities, rates, and broader macro markets this week, Silver refused to break decisively below the mid-$73 area. That resilience reinforces the view that a structural physical-demand floor remains firmly intact around the $70–74 corridor. Industrial demand tied to solar photovoltaics and electrification continues to outpace mine supply in 2026, creating a persistent structural deficit that long-term buyers appear willing to defend aggressively during sharp pullbacks.

As a result, Silver may now be entering a broad consolidation phase. Unless there is a meaningful resolution to the Iran conflict and a deeper unwind in inflation fears there is unlikely to be enough momentum to sustain a breakout above $90. At the same time, structural demand should continue keeping the metal comfortably supported above $70. Silver is therefore likely to remain trapped within a broad $70–$90 range over the coming weeks.

Technically, a firm break above 78.87 minor resistance would suggest Silver has already started another upleg within the broader range structure and reopen the path toward 89.37 resistance next.

Japan’s underlying inflation slowed sharply in April, creating increasingly difficult conditions for the Bank of Japan to justify near-term rate hikes despite recent hawkish rhetoric from several policymakers.

CPI core, excluding fresh food, eased from 1.8% yoy to 1.4% yoy, well below expectations of 1.7% yoy and marking the slowest pace since March 2022. Headline CPI also edged lower from 1.5% yoy to 1.4% yoy, remaining below the BoJ’s 2% target for a fourth consecutive month.

The details of the report reinforced signs that domestic inflation momentum is weakening rather than broadening. CPI core-core, which excludes both fresh food and energy, slowed from 2.4% yoy to 1.9% yoy, while service-sector inflation moderated to just 0.9%. A sharp -10.6% drop in education fees weighed heavily on services prices and offset continued increases across other categories.

The report also highlighted how some of the extreme price pressures seen last year have faded, with rice prices rising just 0.6% yoy compared with a massive 98.4% surge in April 2025. Energy prices fell -3.9% yoy in April following a -5.7% decline in March due to the government measures.

Federal Reserve officials Thomas Barkin and Austan Goolsbee signaled growing concern on Thursday that inflation pressures may prove more persistent than previously expected, reinforcing the broader market shift toward a higher-for-longer interest rate outlook. While neither policymaker explicitly endorsed another rate hike, both emphasized that inflation progress has stalled and that policymakers cannot assume recent supply-driven price shocks will fade smoothly on their own.

Richmond Fed President Thomas Barkin said the Fed’s decision to hold rates steady at the last meeting “made sense” as policymakers gathered more clarity on inflation and labor market developments amid the Middle East conflict and broader economic disruptions. However, he also warned that policymakers may soon face pressures on “the employment side of our mandate, the inflation side of our mandate, or conceivably both.”

Barkin specifically questioned whether the Fed can continue relying on its traditional approach of “looking through” supply shocks, warning that repeated waves of geopolitical tensions, trade fragmentation, rising debt, and supply disruptions could eventually risk “loosening the anchor” for inflation expectations.

Nevertheless, Barkin stopped short of prioritizing either inflation or labor market risks, saying he was “not leaning toward overly focusing on one side or the other.” Still, his remarks reflected increasing unease inside the Fed that structural inflation pressures linked to energy costs and broader global fragmentation may not fade quickly. Markets have increasingly shifted toward pricing scenarios where rates stay elevated for longer and where further tightening remains possible if inflation fails to moderate convincingly.

Chicago Fed President Austan Goolsbee struck a similarly cautious tone, saying “we have a pretty significant inflation problem developing,” while noting that the labor market has remained “mostly stable.” Goolsbee added that “we were making progress, then we stopped making progress,” reinforcing concerns that disinflation momentum has stalled.

The remarks from both officials continue the broader hawkish repricing already underway across rates markets, with Treasury yields remaining elevated as investors increasingly reassess how long restrictive Fed policy may ultimately need to stay in place.

• Bitcoin retraced from the $80,000 level, along with other altcoins, and they are lagging US equities after the latest US-Iran peace draft.
• Cryptos have been consolidating for a while, but present interesting technical indications. A trap or an opportunity?
• Exploring technical analysis and trading levels for Bitcoin and Ethereum.

Bitcoin has pulled back from the important $80,000 level, and this drop has also affected the wider altcoin market.

Right now, cryptocurrencies are somewhat falling behind US stocks after the recent US-Iran peace draft. Nasdaq, normally highly correlated to digital assets, has quickly moved back toward new highs thanks to optimism about diplomacy, but despite the correlations, cryptocurrencies have barely moved.

This clear difference shows that digital assets are not following the usual trends in the broader market, at least for now.

Cryptocurrencies have been stuck in a long period of relative sideways movement, unable to break out as some traders hoped.

This may have been frustrating for those looking for quick gains, but there are still some interesting technical signals to watch. The big question now is whether this slow price action is a warning sign or a chance to buy at a discount.

Total crypto market cap daily chart. Source: TradingView, May 21, 2026.

The digital asset market has shown resilience by bouncing off important moving averages, even though there has not been a big surge in retail trading.

If overall market sentiment remains positive and the peace talks continue to hold, Bitcoin and other cryptocurrencies could soon rally and make up for lost ground compared to tech stocks. But this will depend on whether investors can remain hopeful about the deal and its effect.

Daily crypto performance, 16:48. Source: Finviz, May 21, 2026.

Let's dive right into technical analysis and key trading levels for both Bitcoin and Ethereum to spot if a clear breakout is indeed in play from here.

Bitcoin (BTC) 4H Chart and Technical Levels

Bitcoin (BTC) 4H chart. Source: TradingView, May 21, 2026.

Bitcoin has broken its recent upward channel that brought the action above $80,000, but looking at current trading, the action is far from bearish.

The pullback stalled right at the 4H 200-period MA, $77,000, and is currently acting as support.

Bouncing back above $78,800, the 4H 50 MA, opens the way for a new test of a higher break.

On the other hand, bears will want to see a break of the 200 MA with an extension below $75,000.

Levels of interest for BTC trading:

Support Levels:

• 4H 200-period MA: $77,000
• $75,000 key long-term pivot, acting as resistance
• $70,000 short-term momentum pivot
• $60,000 to $63,000 main 2024 support, recent double bottom
• $59,935 February lows

Resistance Levels:

• $78,800, the 4H 50 MA
• $80,000 to $83,000 mini-resistance, entering and bullish above
• $82,500 cycle highs
• $90,000 to $95,000 minor resistance
• $98,000 to $100,000 pivotal resistance
• Current ATH resistance: $124,000 to $126,000

Ethereum (ETH) 4H Chart and Technical Levels

Ethereum (ETH) 4H chart. Source: TradingView, May 21, 2026.

Ethereum is still showing a somewhat weaker price action than Bitcoin, but is finding support at the bottom of its major pivot region, around $2,100.

Rebounding from here should relaunch better prospects for a rebound, but the action is not showing much impulse from here.

A bounce above $2,200, the 50-period MA, should clear the path for more bullish action ahead.

For bears, look for a clean break and close below $2,100.

Levels of interest for ETH trading:

Support Levels:

• Pivot zone lows: $2,100
• $1,700 to $1,800 pre-bounce 2025 key support, testing
• $1,744 February 6 lows
• $1,380 to $1,500 2025 support
• 2025 lows: $1,384

Resistance Levels:

• 4H 50 MA: $2,200
• Mini-resistance: $2,400
• $2,500 to $2,800 June 2025 pivotal resistance
• $3,000 to $3,200 major momentum pivot, test of $3,000
• $4,950 current new all-time highs

The narrative is easing, but keep track of WTI crude and the latest headlines to stay ahead of the game.

Safe trades.

Nikkei 225: ⬆️ Buy

• Nikkei 225 reversed from round support level 60000.00
• Likely to rise to resistance level 64000.00

Nikkei 225 index recently reversed up from the support zone between the round support level 60000.00 (former strong resistance from February) and the 38.2% Fibonacci correction of the upward impulse from April.

The upward reversal from this from the support zone stopped the previous minor correction iv.

Given the strong daily uptrend, Nikkei 225 index can be expected to rise to the next resistance level 64000.00 (which stopped the previous impulse wave iii).