CFD Indices – Dow Recovers

Market News

  • Stocks in Wall Street rebounded more than 1 percent on Tuesday, bouncing back from a sharp sell-off from the previous day as China stepped in to stabilize their currency, the Yuan, easing concerns that its currency would be the next weapon in the U.S.-China trade war.
  • The Dow Jones jumped 311 points, snapping its five-day losing streak, to close higher at 26,029. Both the S&P 500 and Nasdaq Composite closed 1.3% higher, gaining 37 and 107 points respectively.
  • Chinese central bank on Tuesday firmly rejected the U.S. Treasury’s claims as a currency manipulator, saying that Washington disregards the facts and unreasonably affixes China with the label of ‘currency manipulators,’ which is a behaviour that harms others and oneself.

Market Views

  • Asia Pacific stocks were lower on Wednesday as the Chinese central bank fixed the official midpoint reference for the yuan at 6.9996 per dollar, which was slightly weaker than what the market had expected. Hang Seng index fell 165 points while Nikkei 225 index was down 167 points.
  • Tom Essaye, founder of The Sevens Report, said the stabilization in the U.S.-China trade friction is now the most important key to broader market stabilization. Global market will have a further pull-back if the escalation continues, regardless of what the Fed is going to do as another 25 or 50 basis points of easing won’t materially offset a protracted and escalating trade war.

Dow Jones Index

(CFD Symbol: US30)

Trend :
Recommendation :
Last : 25,816
Target price:
Protective stop:

Outlook

Last night, price rebounded after falling for four consecutive days. However, this rebound was capped by the mid-June low. The 50EMA is falling and pointing downwards at the moment. We could see the index testing 24,930 or even lower at its previous low point at 24,603 if price fail to 26,050. Stochastic is at the oversold extreme but MACD has turned bearish with both of MACD’s lines below the zero line.

Trading Idea

Wait for better trading idea.


Hang Seng Index

(CFD Symbol: HK50)

Trend :
Recommendation :
Last : 25,816
Target price:
Protective stop:

Outlook

Price broke below the rising trendline and the Triangle chart pattern last Thursday. With the falling 20EMA, we are expecting further price decline. Price broke below its previous low point after a huge gap was seen on Friday. Price could be heading towards the Fibonacci 162% correction point at 25,177 or even lower at Fibonacci 200% at 24,258. Stochastic is at the oversold region but is still weak. MACD has also turned bearish with both of MACD’s lines below the zero line.

Trading Idea

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Nasdaq 100 Index

(CFD Symbol: USTec)

Trend :
Recommendation :
Last : 7456
Target price :
Protective stop:

Outlook

Price rebounded and tested the downtrend line last night after hitting the Fibonacci 127% correction point. This downtrend line is now acting as a resistance and capping the price rebound. The 50EMA is falling at the moment. We could see the index testing its recent low point at 7217 again or even lower at 7036 if price is capped by the downtrend line. Stochastic is still weak and MACD has turned bearish with both of MACD’s lines below the zero line.

Trading Idea

Wait for better trading idea


S&P 500 Index

(CFD Symbol: US500)

Trend :
Recommendation :
Last : 2858
Target price:
Protective stop :

Outlook

Price has been falling after breaking below the rising trendline last Wednesday. It breached both the resistance-turned-support level and 50EMA as well. Last night, price rebounded and tested 2866. The 50EMA is declining at the moment. We could see price testing its low at 2766 again should price fail to move above 2866. Stochastic is falling at the moment. MACD has turned bearish with both of MACD’s lines below the zero line.

Trading Idea

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