The Geopolitical Battle: U.S. Urges Netherlands and Japan Against China

In the fast-paced world of global politics and economics, every move is strategic and every decision can have far-reaching implications. Recently, the United States has been making waves by urging the Netherlands and Japan to take actions that could potentially disrupt the flow of technology to China. At the center of this controversy are ASML Holding NV (ASML), Shin-Etsu Chemical Co. (SHECY), and Tokyo Ohka Kogyo Co., key players in the semiconductor industry.

The U.S. Pushes Netherlands to Halt ASML’s Service to Chinese Clients

ASML Holding NV (ASML), a Dutch company, is a world leader in the manufacturing of semiconductor equipment. However, its close ties with China have raised concerns in the United States. The U.S. government is pressuring the Netherlands to restrict ASML from servicing and repairing sensitive chipmaking equipment purchased by Chinese clients. This move is part of a broader effort by the U.S. to limit China’s access to advanced technology, especially in strategically important sectors like semiconductor manufacturing.

ASML Technical Analysis

𝗧𝗲𝗰𝗵𝗻𝗶𝗰𝗮𝗹 𝗢𝘃𝗲𝗿𝘃𝗶𝗲𝘄:
ASML has displayed a notable uptrend as indicated by its price being well above both the 50-day moving average (MA) at 887.50 and the 200-day MA at 729.96, reflecting a bullish sentiment in the medium to long term.

𝗣𝗿𝗶𝗰𝗲 𝗔𝗰𝘁𝗶𝗼𝗻 & 𝗩𝗼𝗹𝘂𝗺𝗲:
The price experienced a recent pullback, closing at 940.21, which could be an opportunity for buyers who believe in the stock’s fundamentals. The volume on the down days appears significant, which might signal distribution.

𝗥𝗲𝗹𝗮𝘁𝗶𝘃𝗲 𝗦𝘁𝗿𝗲𝗻𝗴𝘁𝗵 𝗜𝗻𝗱𝗲𝘅 (𝗥𝗦𝗜):
The RSIIn the world of technical analysis, the Relative Strength Index (RSI) stands as a cornerstone tool for traders seeking insights into market momentum. Developed by J. Welles Wilder ... More stands at 49.60, which is neutral, suggesting that the stock is neither overbought nor oversold at the moment.

𝗢𝗻 𝗕𝗮𝗹𝗮𝗻𝗰𝗲 𝗩𝗼𝗹𝘂𝗺𝗲 (𝗢𝗕𝗩):
The OBVThe On Balance Volume indicator (OBV) is a technical analysis tool used to measure the flow of money into and out of a security over a specified period of time. It is a cumulative ... More shows a slight downtick, which could be a sign of weakening momentum, but it’s not definitive on its own without additional bearish indicators.

𝗦𝘁𝗼𝗰𝗵𝗮𝘀𝘁𝗶𝗰 𝗥𝗦𝗜:
The Stochastic RSIIn the realm of technical analysis, the Stochastic RSI (StochRSI) emerges as a powerful tool for traders seeking to navigate market dynamics with precision. Developed by Tushar S. ... More is at 0.000, indicating the stock might be in an oversold territory, potentially leading to a reversal if other factors align.

𝗔𝘃𝗲𝗿𝗮𝗴𝗲 𝗗𝗶𝗿𝗲𝗰𝘁𝗶𝗼𝗻𝗮𝗹 𝗜𝗻𝗱𝗲𝘅 (𝗔𝗗𝗫):
The ADXThe Average Directional Index (ADX) stands as a cornerstone indicator in the toolkit of technical traders, offering insights into the strength of market trends. Developed by Welles... More stands at 31.86, suggesting that the trend is strong and likely to continue. However, as it is not above the threshold of 35, it may also indicate potential consolidation or reversal.

𝗖𝗵𝗮𝗶𝗸𝗶𝗻 𝗢𝘀𝗰𝗶𝗹𝗹𝗮𝘁𝗼𝗿:
The Chaikin OscillatorNamed after its creator Marc Chaikin, the Chaikin Oscillator stands as a formidable tool in the arsenal of technical analysts. This oscillator is designed to measure the accumulati... More is negative, which could indicate that there is selling pressure and that a downward trend could emerge.

𝗖𝗼𝗻𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗧𝗵𝗼𝘂𝗴𝗵𝘁𝘀:
Investors might want to watch for potential buy signals if the price rebounds from the pullback and aligns with other bullish indicators. The neutral RSI provides room for movement in either direction. Given the mixed signals from different indicators, it would be prudent to look for confirmation before making a decision.

Japan Faces Pressure Over Semiconductor Exports

In addition to targeting ASML, the United States is also turning its attention to Japan. Specifically, it wants Japanese companies like Shin-Etsu Chemical Co. (SHECY) and Tokyo Ohka Kogyo Co. to limit their exports to China. These companies are significant players in the semiconductor supply chain, providing essential materials and components for chip manufacturing. By restricting their exports, the U.S. aims to tighten the screws on China’s access to critical technologies, further exacerbating tensions between the world’s two largest economies.

China’s Response: Accusations and Counterclaims

Unsurprisingly, China has not taken these developments lying down. The Chinese government has accused the United States of attempting to create a politics-based bloc ecology in the “Indo-Pacific” region. According to China, the U.S. is shifting regional priorities away from open, inclusive development and regional governance towards security issues and ideology. Beijing argues that in both military and political arenas, the U.S. has been isolating and suppressing China, while coercing other countries to take sides.

In the economic realm, China claims that the United States is building anti-China club-style multilateral mechanisms under the pretext of “security concerns”. Furthermore, China alleges that the U.S. is actively seeking to build a so-called “value alliance” to contain China’s development, stifling its growth and influence on the global stage.

The Larger Geopolitical Landscape

At its core, the clash between the United States and China over technology and influence is emblematic of a larger geopolitical struggle. Both countries are vying for dominance in key industries, with semiconductor technology serving as a battleground for economic supremacy. The U.S. sees China’s rapid technological advancements as a threat to its own hegemony, prompting it to take proactive measures to contain China’s rise.

However, the repercussions of this geopolitical rivalry extend far beyond just the U.S. and China. Countries like the Netherlands and Japan find themselves caught in the crossfire, forced to navigate between competing interests and alliances. As tensions escalate, the global economy hangs in the balance, with uncertainty casting a shadow over the future of international trade and cooperation.

Bottom-line

The U.S. government’s efforts to restrict technology exports to China are reshaping the geopolitical landscape and intensifying tensions between major world powers. The push to halt ASML’s service to Chinese clients and limit semiconductor exports from Japan underscores the high stakes involved in the battle for technological supremacy. As the rivalry between the United States and China continues to unfold, the world watches with bated breath, aware that the outcome will shape the course of global politics and economics for years to come.