Market News
- Trump and Kim meets in Vietnam in a second summit with the US side seeking tangible steps by North Korea to dismantle its nuclear weapons.
- Fed’s chairman Powell will be back at Congress again. In his first address last night, Powell reiterated again the central bank would be patient and is in no rush to raise interest rate. He expects the US economy to keep expanding at a solid rate though somewhat slower pace.
- The Hang Seng Index was hit today by news that the HK economy grew at a slower 3% rate in 2018 than forecast. Growth was hit by a bruising trade war between US and China.
Market Views
- US market indices got a lift last night from Powell, recovering from earlier losses to move higher but decline in the last hour of trading. We can expect another lift from Powell again tonight.
- US market inability to rally on the back of trade optimism recently could be sign of fatigue. The US market had rallied since Boxing Day on 26th Dec to current high and could be in need of a good correction. We would view such a decline as a corrective decline in a bullish trend.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation : Short
Last : 25,984
Target price: 25,500
Protective stop: 26,300
Outlook
Price trend is rising but MACD is showing divergence and warning of a price reversal. Price has declined below 20EMA, which is acting as resistance at 26,015. Price is also below the neckline of a possible Head and Shoulder chart pattern.
Trading Idea
Look to sell if price moves towards the 20EMA resistance near 26,015. An aggressive point to short would be the break of 25,770 low.
Hang Seng Index
(CFD Symbol: HK50)
Trend : Bullish
Recommendation :
Last : 28,809
Target price:
Protective stop:
Outlook
Price continues to move within the trend channel. It is close to the bottom of the trend channel. Both Stochastic and MACD are near to the bottom of their scale and with price near to the edge of the trend channel, it will likely to bounce higher again.
Trading Idea
Look to buy close to the lower trend channel at 28,705 for a ride back to the upper trend channel
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation : Short
Last : 7089
Target price: 7002
Protective stop: 7122
Outlook
Price is contained inside a possible Rising Wedge chart pattern, which is a bearish reversal chart pattern.
Trading Idea
Watch for a break of the lower trend line and follow in the direction of that break for a ride down to 7000 level.
S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation : Wait for Breakout
Last : 2784
Target price:
Protective stop :
Outlook
Price is near to trend line support. This channel also looks like a possible Rising Wedge chart pattern, which is a reversal pattern. However, both momentum oscillators are near to the low end of their scale. MACD is bullish as well. Price might be able to hold above the trend line.
Trading Idea
Watch the support at 2770. A break will call for a price move lower to 2729. If price is unable to move below the trend line, buy with a stop below the trend line with a target of 2799
