CFD Indices – Covid-19 Halted US Market Rally

Market News

  • Wall Street lost ground on Thursday, backing away from record highs as investors digested new coronavirus developments and mixed corporate earnings. Dow Jones dipped 128 points, suffering the largest percentage loss, while S&P 500 was down 5 points and Nasdaq Composite lost 13 points.
  • Hopes that the Covid-19 could be on the wane were soured by a spike in fatalities, with an additional 242 deaths, bringing China’s coronavirus death toll to 1,367. But the director of the World Health Organization told a news briefing that we are not seeing dramatic increases in cases outside China.
  • Chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities mentioned investors will surely avoid Asia for the time being and will shift funds to U.S., geographically the most separated from the region.

Market Views

  • Asian markets were mixed on Friday morning due to a sharp rise in the number of coronavirus cases in China this week. Soft US market also contributes to the soft sentiment in Asia. Hang Seng index rose 101 points while Nikkei 225 index fell 162 points.
  • Japan confirmed its first coronavirus death on Thursday, a third case outside mainland China after two previous fatalities in Hong Kong and the Philippines.

Dow Jones Index
(CFD Symbol: US30)
Trend : Bullish
Recommendation : Long
Last : 29,471
Target price: 29,730
Protective stop: 29,200

Outlook
This index has rebounded and has created a new record high at 29,584 after being supported at the resistance-turned-support level at 28,160. Price managed to rebound at the previous price resistance turned support of 28,955, which is also the 20EMA support three nights ago. As long as this level holds, our bullish view remains intact for 29,730. Stochastic is turning up and MACD remains bullish.

Trading Idea
Hold Long for 29,730 but bring Stop higher to 29,200


Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 27,905
Target price:
Protective stop:

Outlook
This index managed to recover from the decline after being supported by its previous low at 25,950. Price broke above the Flag pattern, 20EMA and the gap resistance zone two days ago. As long as the gap at 27,470 holds, the upside target will be pegged at 28,610. A closing of the gap is likely to bring price lower. Stochastic is turning up from the oversold region. MACD is bearish but just had a bullish crossover that hint of upside movement.

Trading Idea
Wait for better trading idea.


Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 9628
Target price :
Protective stop:

Outlook
The index hit its new record high at 9635 last night. It is still strong and bullish as it broke above the bullish trend channel. The 20EMA remains bullish and is still rising. We peg the next resistance at 9678, which is the Fibonacci 300% projection level. A move inside the channel will target for the 20EMA which is acting as support for the moment. Stochastic is rising to the overbought region. MACD is still bullish at the moment with both its line well above the zero line.

Trading Idea
Wait for better trading Idea


S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 3381
Target price:
Protective stop :

Outlook
Last night the index again created a new record high at 3385 after the index rebounded from the price support which coincided with the trend channel and the 20EMA at 3300. As long as this index stays within the trend channel, we remain bullish and looking for new highs to 3410. Stochastic is at the overbought region but MACD is still bullish. A bullish MACD crossover was seen, which is likely to bring this index higher towards the next resistance.


Trading Idea
Wait for better trading idea.


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