CFD Indices – Will Trump Signs HK Bill?

Market News

  • Stocks dipped on Thursday as the standoff between the world’s two largest economies expanded beyond trade into Hong Kong, reducing the odds of a “phase-one” deal this year. The Dow Jones index was down 54 points while the S&P 500 index slipped almost 5 points. Nasdaq Composite index was down 20 points.
  • U.S. President Donald Trump is expected to sign into law two bills intended to support anti-government protesters in Hong Kong which “could risk progress toward a phase one trade deal”.
  • The Wall St Journal, citing unnamed sources reported that China has invited US trade negotiators for a new round of face-to-face talks in Beijing. However, it is said that the US camp is a bit reluctant to make the trip unless China makes clear that it would make commitments on IP protection, forced technology transfer and agricultural purchases. 

Market Views

  • Asian equities rose on Friday, bouncing from a three-week low touched a day earlier, but gains were capped by persistent worries over the status of trade negotiations between China and the United States. Nikkei 225 index gained 130 points while Hang Seng is up 71 points
  • Conflicting messages from U.S. and China is sending investors to the side line. Unless we see progress on trade deal, the market is likely to stay sluggish and volatile, swaying with the messages and signals given by either side.

Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 27,804
Target price:
Protective stop:

The index made a new historical high at 28,161 on Tuesday, but has been moving lower and has moved below the 10EMA. We could see a possible price correction to test the upper trendline support at 27,235, which is also the Fibonacci 38% retracement point. MACD is strong and bullish at the moment, but there is a bearish crossover which hints at a potential downward price movement. Stochastic is in the overbought extreme and is moving down.

Trading Idea

Wait for better trading idea

Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation : Short
Last : 26,570
Target price: 25,900
Protective stop: 26,800

The recent four days’ rebound was capped by the 20EMA. The 20EMA is declining at the moment and hence we could expect some downward movement in the near term. A big gap was created yesterday and as long as this gap is not closed, price is likely to head lower to its low at 25,540. Stochastic is moving towards its overbought extreme but is still weak. MACD is still bullish, but both lines are falling at the moment.

Trading Idea

Sell 26,600 for 25,900 with stop above 26,800 was filled on 21 Nov 2019

Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation : short
Last : 8286
Target price : 8035
Protective stop: 8375

The index made a new all-time high of 8374 on Tuesday night. However, it ended the day with a Doji candlestick. A followed-through candle was seen two nights ago, and price is now moving below the rising channel and the 10EMA. Price is likely to head lower to test the breakout level at 8035. Stochastic is in its overbought extreme and is moving down. MACD is strong and bullish but there is divergence warning given along the way, and a bearish crossover was seen.

Trading Idea
Sell 8290 for 8035 with stop above 8375 was filled on 21 Nov

S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 3108
Target price:
Protective stop :

Price created a new-time high at 3132 on Tuesday night and has been moving lower since then. It is now testing the 10EMA. We could see price moving lower to test the gap support at 3065 or even lower at the breakout level which is also the Fibonacci 38% correction point at 3026 if 10EMA cannot halt the price decline. Stochastic is in the overbought region and is moving down. MACD has already shown divergence warning and is moving down.

Trading Idea

Wait for better trading idea.

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