Market News
- Stocks fell from all-time highs on Friday after the release of stronger jobs data dampened hope for easier monetary policy by Fed. Dow Jones was lower by 43 points, S&P 500 was down 5 points and Nasdaq Composite declined 8 points.
- Global equities had generally been bolstered by expectations that central banks will keep interest rates at or near record lows to boost economic growth later this month. However, these expectations were tempered by a U.S. labor report that showed nonfarm payrolls jumped to 224,000 in June, beating forecasts for 160,000, in a sign the world’s largest economy still had fire.
- The strong jobs numbers sent Treasury yields upward, with the benchmark 10-year yield crossing the 2% mark. The 2-year rate also rose to 1.87%. Bank shares got a lift from the higher rates as well.
Market Views
- Stocks in Asia slipped on Monday as investors wagered on a less aggressive policy easing in the U.S., while the Turkish lira held near two-week lows after the country’s president dismissed its central bank governor over the weekend. Nikkei lost 198 points and Hang Seng plunged 515 points.
- The solid U.S. payrolls report dampened Fed rate cut expectations and severely dented the argument for a 50bps rate cut by the end of the month. Effectively the debate has now switched from a 25bps or 50bps rate cut to a 25bps cut or none, according to senior foreign exchange strategist at National Australia Bank.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bullish
Recommendation : Long
Last : 26,837
Target price: 27,500
Protective stop: 26,880 triggered
Outlook
Price recorded its all time high at 27,007 on last Thursday, following a break out above a continuation Flag pattern. However, there was a divergence warning from the MACD. We could see a price pullback towards the 20EMA at 26,550, which is also near the Fibonacci 38% of the rally from 13th June to 4th July. Stochastic is in the overbought region and could turn around.
Trading Idea
Wait for better trading idea.
Hang Seng Index
(CFD Symbol: HK50)
Trend : Bullish
Recommendation : Long
Last : 28,260
Target price: 29,510
Protective stop: 28,600 triggered
Outlook
Price broke above the triangle pattern with a gap up on last Tuesday. However, the gap was filled last Friday with a bearish long red candlestick. Price is now testing the 20EMA which is also the lower boundary of the triangle pattern. Should price break below the 20EMA, price could be heading towards the Fibonacci 62% at 27,584. Stochastic is in the overbought region and has turned down. MACD is bullish at the moment but is showing divergence and warning of a potential high.
Trading Idea
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7805
Target price :
Protective stop:
Outlook
Price hit its record high on last Friday but closed lower, following the rebound from the downtrend line. However, there is a divergence warning from the MACD which is giving concern. We could see price pullback towards the 20EMA at 7670. Stochastic is in the overbought region and could turn around.
Trading Idea
Wait for new trading idea and opportunities.
S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 2981
Target price:
Protective stop :
Outlook
Price hit its record high for a second consecutive day at 3000 last Friday. The 20EMA is still bullish and is rising. However, a divergence warning from the MACD could raise concern. There could be a possibility that price pullback to 20EMA at 2935 or even lower at 2909. Stochastic is in the overbought region and could turn down.
Trading Idea
Wait for trading idea and opportunities.
