Market News
- US stocks were mixed after the close on Monday, as Wall Street digested strong gains from the previous week and looked ahead to the start of the corporate earnings season. The Dow fell Monday, weighed down by Boeing while the S&P and Nasdaq eked out small gains.
- Equity trend remains bullish but is now getting stretched after a 16% gain in first quarter of 2019. We may need to see a correction before the rally can resume.
- On the data front, U.S. factory orders for February fell 0.5% amid weakness in the machinery, transportation equipment and electronic products segments. Shipments, however, rose 0.4%.
Market View
- Asian shares got off to a subdued start on Tuesday as investors braced for key events later in the week, including the kick-off of the U.S. earnings season and a crucial Brexit summit, while broader concerns over slowing global growth checked sentiment.
- Wall Street expects this earnings season to be a tough one. First-quarter S&P 500 earnings are expected to have fallen 4.2% on a year-over-year basis, according to FactSet. That would be the first earnings contraction for the S&P 500 since the second quarter of 2016.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bullish
Recommendation :
Last : 26,294
Target price: 26,970
Protective stop: 26,200
Outlook
Price reached a high of 26,497 on Friday and has been consolidating since. Currently its decline is supported by the rising 20EMA, currently at 26,294. Stochastic is rising from the oversold extreme and MACD is turning up as well, which are bullish signs. The index could be heading towards the historical high of 26,970 but caution is advised as MACD is starting to show divergence warning.
Trading Idea
Keep long position for 26,970 with stop below 26,200
Hang Seng Index
(CFD Symbol: HK50)
Trend : Bullish
Recommendation :
Last : 30,230
Target price: 30,650
Protective stop: 29,800
Outlook
Price reached a high of 30,309 on Monday and could be heading higher to the Fibonacci 161.8% target at 30,650. Stochastic is into overbought extreme but is showing signs of another price rally. MACD is still bullish but is losing momentum and there could be divergence warning in the process of forming. The trend is still bullish and could be heading higher to 30,650 but caution is advised.
Trading Idea
Keep long for 30,650 with protective stop below 29,800.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend : Bullish
Recommendation :
Last : 7592
Target price:
Protective stop:
Outlook
Price made a new high this morning at 7607. The new high averted a possible Double Top chart pattern for the moment. MACD is still bullish but divergence warnings are forming. Stochastic is hinting of one more push higher to another new peak. We could be approaching a market top soon and caution is advised
Trading Idea
Be cautious of a reversal. Watch support at 7533.
Nikkei 225 Index
(CFD Symbol: JP225)
Trend : Bullish
Recommendation :
Last : 21,778
Target price: 21,973
Protective stop : 21,650
Outlook
Price reached a high of 21,973 yesterday and has been consolidating for the past 24 hours. Price is supported by a support zone around 21,700. If price can stay above this support zone, we may see another price test to 21,973 in the next few days. Stochastic is rising and MACD is turning up. However, both Stochastic and MACD have a bearish divergence warnings and caution is advised.
Trading Idea
Buy at 21,770 for 21,970 with stop below 21,650
