Market News
- Dow rallied 306 points to end another wild week on Wall Street as a rebound in bond yields from historical lows, eased fears of a recession that sent stocks tumbling earlier in the week. S&P 500 rose 41 points and Nasdaq Composite was up 129 points.
- Bond yields climbed back from their historic lows last Friday, after a Der Spiegel article said that Germany would boost spending by issuing more debt. Bank stocks rose along with the rising bond yield. The yield curve is no longer inverted on Friday and stocks started to move higher as the curve steepened with the rise in yields.
- The U.S. – China trade war is still a big driver of market movements. Trump said he is not ready to make a deal yet and he hinted that the White House would like to see Beijing resolve ongoing protests in Hong Kong first.
Market Views
- Asian stocks edged up on Monday morning as U.S. Treasury yields bounced higher after plunging last week which sent markets into a panic selling. Hang Seng index advanced 425 points and Nikkei 225 index gained 103 points.
- Trump on Sunday told reporters before boarding Air Force One in New Jersey that he did not want to do business with Huawei for national security reasons. U.S. Commerce department would extend the Huawei licensing process for three months as a gesture of “good faith” amid broader trade negotiations with China.
Dow Jones Index
(CFD Symbol: US30)
Trend : Bearish
Recommendation : Short
Last : 26,037
Target price: 24,610
Protective stop: 26,210
Outlook
Price has been rebounding for three consecutive days after hitting a low at 25,233. We are expecting the 50EMA, which is around the mid-June low resistance level, to provide resistance and halt the rebound, if resistance at 26,050 is unable to cap the rebound. If the index cannot surpass the mid-June resistance, it is heading towards its previous low point at 24,603 again. Stochastic is rising but MACD is bearish with both of MACD’s lines below the zero line.
Trading Idea
Sell 25,900 for 24,610 with stop above 26,210 was triggered on 19 Aug
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 25,147
Target price:
Protective stop:
Outlook
Price reached a low at 24,941 and rebounded, forming a Harami candlestick pattern last Thursday. The rebound is likely to head towards the previous high resistance at 26,350. We could see price testing the 20EMA at 26,520 as well or even higher at 26,910 which is the Fibonacci 50% retracement point. Stochastic is in the oversold extreme but is turning up. MACD is still bearish.
Trading Idea
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7640
Target price :
Protective stop:
Outlook
Price managed to close above the downtrend line with a bullish green candlestick last Friday. Price is heading towards its overhead 20EMA resistance point at 7673. A move above 7673 could see the index testing its previous high of 7780. Stochastic could turn up again in the coming session. MACD is still bearish with both of MACD’s lines below the zero line.
Trading Idea
Wait for better trading idea
Australian 200 Index
(CFD Symbol: AUS200)
Trend :
Recommendation :
Last : 6507
Target price:
Protective stop :
Outlook
Price hit a low at 6405 last Thursday. A Piercing Line candlestick pattern was formed on Friday. There is also divergence warning given from the MACD, hinting at a possible price rebound. We could see the index testing 50EMA at 6640, which is also the Fibonacci 50% retracement point. If price can close above 6522, it would confirm the reversal candlestick pattern. Stochastic is at the oversold region and could turn up soon. MACD is still bearish at the moment.
Trading Idea
Wait for better trading idea.
