Market News
- Stocks on Wall Street took a dive last Friday as investors feared Trump’s surprise threat of tariffs on all Mexico imports, amid a worsening trade war with China, could risk sending the U.S. economy into a recession.
- Dow dropped more than 350 points, posting its longest weekly losing streak since 2011 as it dropped 3% last week and notched its sixth straight weekly loss. S&P 500 closed 36 points lower and the Nasdaq Composite was down 114 points. The major indexes snapped a four-month winning streak.
- The closely watched 10-year Treasury yield dropped to lows not seen since 2017. The U.S. benchmark was yielding 2.13% last Friday. A portion of the yield curve remained inverted as the yield on the 3-month Treasury bill held at 2.35%.
Market Views
- Asian stocks were mixed in Monday morning trade amid increasing concerns over the state of global trade. Nikkei dropped 1.17% while Hang Seng and Shanghai Composite were up by 0.2%.
- On Thursday evening, Trump announced the U.S. would impose a 5% tariff on all Mexican imports from June 10 until illegal immigration across the southern border was stopped. The tariffs will gradually rise to 25% if Mexico does not comply with Trump’s demands.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 24,667
Target price:
Protective stop:
Outlook
Price has moved lower after breaking below the support level of 25,229. A Head and Shoulder chart pattern has a price target of 23,684. Price is now on the way down to 24,088, which is the Fibonacci 50% correction point of 2019’s rally. The next target would be the H&S target at 23,684. Stochastic is weak and moving into oversold zone but MACD is bearish and its trend is still bearish.
Trading Idea
Wait for pullback towards the neckline at 25,090 to get into a short position for a decline to 23,684 with stop above 25235.
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 26,850
Target price:
Protective stop:
Outlook
Price moved below the key support of 26,944, which is the Fibonacci 62% correction point, with a gap down last Friday.
This move has turned the price outlook to negative. Price is unlikely to hold at 26,641 and we think price could be on the way down to the next support at 26,026. Stochastic is into oversold extreme but still weak at the moment. MACD is also bearish.
Trading Idea
Wait for better trade idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7077
Target price
Protective stop:
Outlook
Price has moved below the Fibonacci 38% correction point of 2019’s rally at 7192. Our bearish view remained unchanged. With bearish 20EMA and MACD, we think price could move lower to 6987, which is the Fibonacci 50%. Stochastic is into oversold extreme but still weak at the moment.
Trading Idea
Wait for better trade idea.
Australian 200 Index
(CFD Symbol: AUS200)
Trend :
Recommendation :
Last : 6385
Target price:
Protective stop :
Outlook
Price was resisted by its overhead 20EMA resistance at 6430 and has moved below 6407, the Fibonacci 50% correction point of May 2019’s rally. Price could be coming down to 6370, the Fibonacci 62%. We don’t think price could hold at 6370. A move below 6370 will bring the price lower to 6251. Stochastic is weak and MACD is still bullish.
Trading Idea
Wait for a rally to 6415 to get into a short position for a decline to 6251 with stop above 6491.
