Market News
- US indices were little changed from the previous day as the market awaits news on trade deal negotiation between US and China. A good set of ISM data which showed the most new orders since Aug 2005 failed to excite the market.
- Mike Pompeo had said on Monday that negotiation was on a “cusp of a deal” but on Tuesday, he said “things are in good place but it got to be right”. This got market worried that a deal might not be so soon.
- China has given a 6-6.5% growth target for 2019 but recent China’s data have been poor. Will growth be able to meet the government’s target are on many investors’ mind.
Market View
- Trade deal resurfaced again as market waits for confirmation of a deal. US indices have climbed 18% in the past 3 months. Investors are wary of a market correction.
- Asian markets are tentative this morning. Nikkei 225 is weaker but both Shanghai and Hang Seng Index are positive.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bearish
Recommendation : Short
Last : 25,777
Target price: 25,500
Protective stop: 25,975
Outlook
Price stayed below the 20EMA after breaking below the neckline of a Head and Shoulder chart pattern. The price target of the pattern is 25,500. MACD is bearish. We are expecting a price movement to target at 25,500.
Trading Idea
Look to get into a short position if price moves towards the resistance zone near 25,900 to 25,950 with a stop above 26,100.
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 28,950
Target price:
Protective stop:
Outlook
Price continues to move within the trend channel. It is close to the bottom of the trend channel. Stochastic and MACD are both neutral at the moment and not giving any hints. A break below the channel would be an indication of a change in the current bullish channel to a bearish trend with a target at 28,815
Trading Idea
Watch the reaction at the trendline. A break below is an indication of a bearish movement lower to 28,815. If price manages to stay within the trend channel, it is likely to test the top end of the channel.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7128
Target price:
Protective stop:
Outlook
Price stayed above the trend line after testing it. Price is also around the 20EMA. This is an indication of a sideways movement at the moment. If price stays above the trend line, it is likely to test the topside again. A break will indicate a bearish movement to the base at 6988
Trading Idea
Watch for a break of the lower trend line and follow in the direction of that break for a ride down to 6988 level.
Nikkei 225 Index
(CFD Symbol: JP225)
Trend : Bearish
Recommendation : Short
Last : 21,612
Target price: 21,360
Protective stop : 21,800
Outlook
Price broke the trendline this morning. This channel also looks like a Rising Wedge chart pattern, which is a reversal pattern. MACD is still bullish but is declining into bearish zone. Stochastic is neutral at the moment. Price should be moving towards target at 21,360.
Trading Idea
Keep short position if short at this morning breakout. If not look to get into a short positon as close to the trendline breakout as possible. Target is at 21,360
