- S&P 500 surged 1%, hit a new record high as an almost giddy euphoria over the prospects of a U.S. interest rate cut fueled the appetite for equities, but there are plenty of pitfalls that could throw the stock market off course. Dow Jones was up 249 points and Nasdaq Composite rose 64 points.
- The 10-year Treasury yield dipped below 2% for the first time since November 2016 after Fed signalled the potential for a rate cut as soon as its next meeting in July as it said it was ready to battle risks to the economy, including the U.S.-China trade war.
- Kota Hirayama, senior emerging market economist at SMBC Nikko Securities in Tokyo, said this week’s FOMC meeting outcome is positive for the financial markets including those in Asia, but it won’t be able to sustain Asian equities indefinitely until some kind of solution can be worked out for the U.S.-China trade war at the G20, since the region is particularly vulnerable to the conflict.
- Asian stocks struggled on Friday to track Wall Street’s exuberance about a possible U.S. rate cut next month as anxiety over Sino-U.S. trade negotiations clouded the investor mood in the region. Nikkei dropped 42 points while Hang Seng was down 47 points.
- Tensions in the Middle East continued to heat up after an Iranian missile shot down an unmanned U.S. surveillance drone on Thursday, raising fears of a military confrontation between Tehran and Washington and pushing the crude oil price higher.
Dow Jones Index
(CFD Symbol: US30)
Last : 26,707
Target price: 26,710 reached
Price hit and closed above its previous high of 26,710 yesterday, after breaking above a flag pattern on Monday. The 20EMA is still strong and bullish. Price could be testing the next resistance point at 27,278, which is the Fibonacci 127% of the decline from 1st May to 3rd June. The Dow historical high is at 26,828. Stochastic is into the overbought region but still looks strong at the moment. MACD is bullish and is also rising above its zero line.
Wait for better trade idea
Hang Seng Index
(CFD Symbol: HK50)
Last : 28,560
Price continued its rally and closed above Fibonacci 50% of the decline from 3rd May to 4th June yesterday with a gap up. With a bullish 20EMA, price could be on the way to the Fibonacci 62% at 28,942 or even the higher gap resistance at 29,480. Stochastic is still rising at the moment. MACD is still bearish, but the slow line is rising towards its zero line.
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Last : 7715
Price broke above the downtrend line with a bullish green candlestick on Tuesday. The 20EMA is still strong and bullish. Price could move higher towards its previous all time high at 7860. A move above 7860 could bring price higher to 8110, which is the Fibonacci 127% of the decline from 6th May to 3rd June. Stochastic is in the overbought region but still looks strong at the moment. MACD is bullish and it is above its zero line.
Buy dip to 7590 with stop below 7490 for 7860.
S&P 500 Index
(CFD Symbol: US500)
Last : 2947
Protective stop :
Price hit its record high at 2958 yesterday with a bullish green candlestick. The 20EMA is still strong and bullish at the moment. A move above 2958 could bring price higher towards 3020, the Fibonacci 127% of the decline from 1st May to 3rd June. Stochastic is in the overbought region but still look strong at the moment. MACD is bullish and it is rising above the zero line.
Wait for better buying opportunities.