Market News
- Stocks fell on Monday as the intensifying fallout from a U.S. crackdown on Chinese telecom giant Huawei pressured the technology sector. Dow Jones closed down by 84 points, off its low after dropping at one stage by 203 points.
- Trump’s executive order that required US companies to get a license before doing business with Huawei led to Google, Intel, Qualcomm and Broadcom suspending business with Huawei. This weighs on market sentiment and affects technology stocks with Qualcomm falling 6% in last night trading.
- CNBC reported that U.S.-China trade talks have stalled. CNBC reported that scheduling discussions had not happened as the U.S. increases pressure on Chinese telecom companies. Meanwhile, the South China Morning Post said that China was in no rush to continue trade talks.
Market Views
- Shares in Asia were mixed on Tuesday amid the ongoing fallout surrounding Chinese telecommunications giant Huawei. Hang Seng and Nikkei 225 were lower but Australian 200 Index made a new high.
- US officials said Monday they would grant a handful of temporary exceptions to an export blacklist against Huawei, giving some suppliers and customers of Huawei, a 90-day reprieve. A Commerce Department filing said the delay does not change the ban imposed by Trump on national security grounds.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bullish
Recommendation :
Last : 25,792
Target price:
Protective stop:
Outlook
Price has recovered from a low of 25,229 to 26,000 but the rally could come into strong resistance around 26,036 with previous price highs and 20EMA providing resistance. Stochastic has been climbing higher but is weak. MACD is still bearish and 20EMA is bearish. It is not clear if the correction is over.
Trading Idea
Wait for better trade idea.
Hang Seng Index
(CFD Symbol: HK50)
Trend : Bullish
Recommendation :
Last : 27,886
Target price: 30,650
Protective stop:
Outlook
The index had declined to Fibonacci 50% correction point of the 2019’s rally. Index has managed to bounce of the correction point but MACD is still bearish and Stochastic is in oversold extreme. 20EMA is bearish and its gradient steep, hinting of a strong bearish trend. A move below the Fibonacci 50% point would target the 62% point while a move above 28,000 is likely to see a price rally to 20EMA resistance at 28,787.
Trading Idea
Buy 27,600 for a price rally to 28,780 with stop below 27,280
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend : Bullish
Recommendation :
Last : 7427
Target price
Protective stop:
Outlook
This index has managed to stay above its Fibonacci 38% of 2019’s rally as well as a strong support area at 7202 to 7247. While MACD is still bearish, Stochastic has managed to move higher. 20EMA is still bearish. We are expecting price to test the support zone of 7202-7247 again as 20EMA and MACD are both still bearish.
Trading Idea
Wait for dip to 7202-7247 to buy for a rally to 7520 with stop at 7165.
Australian 200 Index
(CFD Symbol: AUS200)
Trend : Bullish
Recommendation :
Last : 6537
Target price:
Protective stop :
Outlook
Despite the trade talk worries, this index has made another new high today for a second consecutive day. The target for this breakout is at 6660, based on Ichimoku V price forecasting. Both Stochastic and MACD are both rising. MACD is bullish and 20EMA is also bullish.
Trading Idea
Buy at 6490 for 6660 with stop below 6410.
