CFD Indices 14 May 2019

Market News

  • U.S. stocks fell sharply on Monday, posting its worst showing since 3 Jan 2019 after China raise tariffs on some U.S. goods as the ongoing trade war between the world’s largest economies intensifies. Dow Jones dropped 617 points, S&P 500 fell 69 points, while Nasdaq Composite dropped 270 points
  • China on Monday announced it would impose higher tariffs on $60 billion of U.S. goods following Washington’s decision last week to hike its own levies on $200 billion in Chinese imports. The goods targeted include a broad range of agricultural products. 
  • The U.S. Trade Representative’s office said it planned to hold a public hearing next month on the possibility of imposing duties of up to 25% on a further $300 billion worth of imports from China.

Market Views

  • Shares in Asia extended losses on Tuesday following sharp falls on Wall Street overnight, as the trade war between China and the United States escalated.
  • Underscoring market concerns over the economic impact of the trade war, 10-year yields remained below those on three-month Treasury bills. A sustained inversion of this part of the yield curve has preceded every U.S. recession in the past 50 years.

Dow Jones Index

(CFD Symbol: US30)

Trend :
Recommendation :
Last : 25,420
Target price:
Protective stop:

Outlook

On a longer term outlook, we remain bullish as current price decline could be a correction of 2019’s rally. First support at 25,234 was reached last night but this index is still above Fibonacci 38% of this year’s rally is at 24,707. Stochastic and MACD are both trending lower and not showing any signs yet of a reversal. MACD is still bearish. We think the correction could go lower to 24,707.

Trading Idea

Wait for a price dip to 24,707 to get into a long position for the next rally.


Hang Seng Index

(CFD Symbol: HK50)

Trend :
Recommendation :
Last : 28,226
Target price:
Protective stop:

Outlook

The correction has moved below the Fibonacci 38% correction of this year’s rally. It could be heading towards the Fibonacci 50% point. Stochastic is still moving lower and MACD is still bearish and moving lower. We think the decline may not be completed as yet. There could be potential for further decline towards the Fibonacci 50% correction point of 27,595.

Trading Idea

Wait for price to come into the support zone from 27,774 to 27,595 to get into a long position for the next rally.


Nasdaq 100 Index

(CFD Symbol: USTec)

Trend :
Recommendation :
Last : 7351
Target price
Protective stop:

Outlook

Price is currently approaching a support area. We need to see if this support zone at 7201 to 7243 can hold. As Stochastic is still moving lower and MACD is not turning around as yet; there is a possibility of this index moving lower. The next support is at Fibonacci 38% correction point of 7071.

Trading Idea

Wait for price decline to support zone at 7201 to get into a long position.


S&P 500 Index

(CFD Symbol: US500)

Trend :
Recommendation :
Last : 2820
Target price:
Protective stop :

Outlook

Stochastic is still heading lower and there is no signs yet of a turn around. MACD is bullish but the correction may not be over. We think this index is likely to head lower to the next support point at either 2784 or 2745. Fibonacci 38% correction point of this year’s rally lies at 2712. We believe this decline is corrective and the overall trend is still bullish.

Trading Idea

Wait for a price decline towards Fibonacci 38% support point 2712 to get into a long position for the next rally.


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