Market News
- US indices closed at a 3-day low after investors run out of reasons to buy after the market’s strong rally since the start of the year, which has moved the market up 18%
- A record 2018 US trade deficit did not help the US market. Fed’s member Williams comment about the persistence of low inflation further curtailing expectation of interest rate hikes in the near future did not help the market.
- Chinese stocks have staged a robust rebound this year, recouping much of 2018’s losses, buoyed by hopes that Beijing will roll out more support and measures for a slowing economy. Signs of progress in US-China trade talks also help.
Market View
- With US reporting season ending, investors are looking for next catalysts to drive the market with tomorrow Non-Farm Payroll being the main focus.
- Asian markets are weaker today with Hang Seng and Nikkei index down by more than 100 points. Shanghai index was little changed for today.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bearish
Recommendation : Short
Last : 25,651
Target price: 25,500
Protective stop: 25,925
Outlook
Price stayed below the 20EMA after breaking below the neckline of a Head and Shoulder chart pattern which has a price target of 25,500. Price is approaching the previous low at 25,615. 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 to the 20EMA and previous resistance at 25,750.
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 28,955
Target price:
Protective stop:
Outlook
Price moves in a range of 29,200 to 28,650. Price tested the top of this range yesterday and this morning has started to move lower. Stochastic is into overbought extreme and likely to move lower but MACD is still bullish. A break below 28,615 would hint of a decline to 28,070
Trading Idea
Price is in a range. We would recommend playing with the range. Look to short near to 29,000 with a stop above 29,250.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend : Bearish
Recommendation : Short
Last : 7092
Target price: 7012
Protective stop: 7135
Outlook
Price broke below the trend line and the 20EMA and the trend is now bearish. Price should be moving lower to test the Fibonacci 50% point at 7012. MACD is bearish and Stochastic is moving lower. Both momentum oscillators are hinting of a price decline.
Trading Idea
Look to get into a short position at resistance point of 7109 for a decline lower to 7012
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 and is moving towards its target at 21,360. This channel also looks like a Rising Wedge chart pattern, which is a reversal pattern and has a price target of 20,845. MACD has turned bearish. Price is moving towards the channel target at 21,360. Another possible target lies at previous high of 21,260
Trading Idea
Keep short position if short at yesterday’s breakout for target at 21,360. If not, look to get into a short positon close to the 20EMA at 21,585. Target is at 21,360 or 21,260
