Market News
- Last Friday, all three major indices tumbled more than 1.5% as the spreading coronavirus outbreak along with sluggish U.S. economic data and a mixed batch of corporate earnings fueled concerns about global growth. Dow Jones plunged 603 points, S&P 500 fell 58 points and Nasdaq Composite slid 148 points.
- Economists fear this coronavirus could have a bigger impact than Severe Acute Respiratory Syndrome (SARS) which killed about 800 people between 2002 and 2003, as a total of 361 people have died in China from the new virus with the first death out of the mainland reported on Sunday.
- Apart from the fear of Wuhan virus, U.S. data showed that consumer spending rose steadily in December, but wage gains indicated moderate growth in consumption and business investment contracted, putting the economy on a slower pace this year.
Market Views
- Asian markets are set for another bumpy ride on Monday morning on fears about the hit to world growth from the rapidly spreading coronavirus, with all eyes on China where trading resumes following the Lunar New Year break. Hang Seng index fell 92 points and Nikkei 225 index declined 223 points.
- China’s central bank plans to inject 1.2 trillion yuan ($173.8 billion) of liquidity into the markets via reverse repo operations on Monday, which would help firms that produce vital goods resume work as soon as possible.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 28,425
Target price:
Protective stop:
Outlook
Price broke below the trend channel and a price recovery was halted by the price resistance at 28,955. This index declined and is now sitting on its resistance turned support at 28,160. If price is unable to hold above this support, this index is likely to test the next support level at 27,320. If price can hold the support, this index can test back to 28,770. Stochastic is still moving lower. MACD is bullish at the moment. Watch the support at 28,160.
Trading Idea
Wait for better trading Idea
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 26,346
Target price:
Protective stop:
Outlook
This index broke below the trend channel and is now sitting at its previous low support at 25,950. We would like to see a firm close above this support level and if this index can hold above this support, a move above 26,845 would hint at the 20EMA resistance at 27,680. If support at 25,950 gives way, the next support is at 25,530. Stochastic has turned down but we could see a bullish crossover soon. MACD has turned bearish.
Trading Idea
Wait for better trading Idea
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 9066
Target price :
Protective stop:
Outlook
The index is still trading within the trend channel and has also been able to hold above the previous low at 8920. It is now hovering around the 20EMA. As long as price stays inside the trend channel, this index will remain bullish and could test its all-time high again. A break below the trend channel could turn the trend into a bearish trend. Stochastic is still moving lower but we could see a bullish crossover soon. MACD is still bullish at the moment with both its line above the zero line.
Trading Idea
Look to buy dip at 8965 for a rally to 9230 with stop below the trend channel at 8870.
S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 3245
Target price:
Protective stop :
Outlook
The index broke below the trend channel and the falling 20EMA. If price could not rise back inside the trend channel, we could see price moving lower towards the support zone at 3181. Price resistance at 3296 is also likely to cap any price rally at the moment. Stochastic is turning down but we could see a bullish crossover soon. MACD is still bullish at the moment.
Trading Idea
Wait for better trading idea.
