Market New
- Fresh uncertainties after lawmakers rejected terms of a deal for UK to withdraw from the EU led to a softer US equity market. Asian markets got off to a subdued start after a mixed finish on Wall Street and with London market likely to slide, may stay subdued for the day.
- Dow fell as Boeing took another sharp 6% hit, while both S&P and Nasdaq Composite Index closed higher on the day. Dow closed 96 points lower with Boeing accounting for a 150-point drag. Dow would have closed higher if not for Boeing’s sharp decline.
- It was the worst weekly performance of 2019 amid growing concerns of a possible economic slowdown around the world. Trade talks between US and China are in final weeks of negotiation but there are still major issues. Lighthizer said if current issues are not resolved, there will not be an agreement. This adds to uncertainties in the markets.
Market Views
- Growing uncertainties over Brexit and trade talks are likely to cap global equity market rally in the coming days. London market is likely to slide as its parliament could not agree on a Brexit deal and this could mute both Asian and US equity market.
- Nasdaq has moved above its recent high and this uptrend could persist on the back of strong performances by Facebook and Apple. Australian 200 index has moved below its recent low but we think the decline may be weak. There are supports at 6150 and 6130 that could halt the decline.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bearish
Recommendation : Short
Last : 25,500
Target price: 25,000
Protective stop: 25,780
Outlook
Price moved higher than our expectation reaching a high of 25,774 and has since declined. As the index failed to break above Fibonacci 62% correction point, the trend is likely to be bearish. We remain bearish and are looking for another decline lower to 25,000 unless the Dow is able to move above 25,780
Trading Idea
Hold short position from yesterday for 25,000. Protective stop should be placed at 25,780.
Hang Seng Index
(CFD Symbol: HK50)
Trend : Bearish
Recommendation : Short
Last : 28,773
Target price: 28,525
Protective stop: 29,300
Outlook
Price reached the Fibonacci 50% retracement level and has since climbed back to 28,955. We view this rally as corrective and a decline is likely to follow. Support is at 28,747 and a break of this 20EMA support will trigger a bigger decline. MACD is bearish and Stochastic is turning down from overbought zone.
Trading Idea
Look to sell at resistance of 28,945 for another decline to 28,525.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7182
Target price
Protective stop:
Outlook
Price made a new high but Stochastic is into overbought zone and MACD is turning down. MACD is bullish. However we are wary this could be the high and price could be turning down as the trend is not that strong and momentum oscillators are stretched. We prefer to wait for bullish confirmation.
Trading Idea
We wait for confirmation of a bullish trend.
Australian 200 Index
(CFD Symbol: AUS200)
Trend : Bullish
Recommendation : Long
Last : 6209
Target price: 6269
Protective stop : 6170
Outlook
Price hit a new low this morning at 6173 and has since moved higher. The candlestick at the low was in the form of a Hammer pattern, which is a reversal pattern. We think this index has reached a low and is likely to move higher. Both MACD and Stochastic have divergence warnings of a possible low as well.
Trading Idea
Buy at 6209 for target at 6269 with stop just below the low at 6170.
