CFD Indices – Optimism Over Trade Deal Faded

Market News

Market News

  • Stocks in Wall Street rebounded last night, following a sharp sell-off in the prior session, after Trump predicted a trade deal with China, easing investor concerns after a ramp-up in rhetoric derailed markets last week. Dow Jones gained 269 points, S&P 500 was up 31 points and Nasdaq Composite closed 101 points higher due to the rise in Apple, a tariff-sensitive company.
  • Trump on Monday flagged the possibility of a trade deal with China. He said that he believed China was sincere in its desire to reach an agreement, citing what he described as increasing economic pressure and job losses in China.
  • However, Global Times Editor-in-Chief Hu Xijin said in a tweet that negotiators from both sides have been keeping contact at technical level; it doesn’t have the significance that Trump suggested. Beijing won’t cave to U.S. pressure and didn’t change their positions.

Market Views

  • Asian stocks rose in step with their global peers on Tuesday morning, as signs of Sino-U.S. trade hostilities might be easing for now helped restore investor confidence after the previous session’s rout. Nikkei 225 index was up 248 points while Hang Seng index rose 61 points.
  • Apart from the high uncertainty trade dispute, investors also have to keep an eye on Brexit proceedings, monetary policy of key players such as the European Central Bank and the moves in the Chinese Yuan.

Dow Jones Index
(CFD Symbol: US30)

Trend :
Recommendation :
Last : 25,957
Target price:
Protective stop:

Outlook

The index’s rebound was capped by the 50EMA, which is also near to the mid-June low resistance level, marking the end of the corrective rally. A bearish long red candlestick followed after a spinning top candlestick formed on Thursday, reinforcing the bearish trend. Price is likely to move in sideway manner in between the 50EMA and support at 25,070. A move below 25,070 would target the previous low point at 24,603. Stochastic is rising but MACD is still bearish at the moment.

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Hang Seng Index
(CFD Symbol: HK50)

Trend :
Recommendation :
Last : 25,780
Target price:
Protective stop:

Outlook

The declining 20EMA is acting as a resistance, capping price’s rebound and marking the end of the consolidation for the past four days. We expect the index to trend lower and test its previous low at 24,941 again with the steep slope of the 20EMA hinting at the strong downtrend. A move below 24,941 could bring the index lower to 23,890. Stochastic is still rising but MACD is still bearish.

Trading Idea

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Nasdaq 100 Index
(CFD Symbol: USTec)

Trend :
Recommendation :
Last : 7597
Target price :
Protective stop:

Outlook

Price tested the downtrend line again as it could not break above its previous high of 7780. However, price rebounded from the downtrend line last night. Price is likely to move within 7780 resistance point and its low at 7357. Should price stay below the downtrend line, we could see a decline to targets at 7220 or 7195. Stochastic is still rising but MACD is still bearish at the moment.

Trading Idea

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S&P 500 Index
(CFD Symbol: US500)

Trend :
Recommendation :
Last : 2885
Target price:
Protective stop :

Outlook

The index was capped by its previous high resistance level at 2940. Last night, it hit a low at 2810 and rebounded. With the relatively flat 50EMA, price is likely to range between 2940 and 2810. Stochastic is rising at the moment but MACD is still bearish with both of the MACD’s lines below the zero line.

Trading Idea

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