Market News
- Dow Jones tumbled more than 1,000 points last night, notching the biggest one-day percentage losses in two years to close 1,031 points lower. This was also the third time in its history. S&P 500 and Nasdaq Composite plunged more than 3% in a day.
- The falls were mainly due to the surge in the coronavirus cases outside China such as Iran, Italy and South Korea, increasing worries about the global economic impact of a potential pandemic. Goldman Sachs slashed its U.S. growth forecast on Sunday and predicted a more severe impact from the epidemic.
- Treasury yields fell to their lowest levels since 2016 as investors sought safety in government bonds, while the yield curve inversion between the 3-month and 10-year U.S. Treasuries deepened in what is often viewed as a recession predictor.
Market Views
- Asian markets were trying to stabilize on Tuesday morning after a wave of early selling petered out and Wall Street futures managed a solid bounce, allowing investors to take a break from coronavirus fears.
- Nikkei 225 index had a sharp decline of 655 points; just catching up to the global sell-off that having been shut on Monday for a holiday. Hang Seng index is relatively flat as it rose 23 points.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 28,198
Target price:
Protective stop:
Outlook
This index made a new record high at 29,584 on the 12th of Feb 2020 and has been declining since that date. It broke below the bullish trend channel and also the resistance-turned-support level at 28,160. The 20EMA is falling at the moment, suggesting more potential downward movement ahead. We could see a possible corrective rally to test the channel resistance at 28,710 before further decline. Stochastic is heading lower but MACD remains bullish. There is a bearish divergence warning as well.
Trading Idea
Sell 28,500 for a test of 27,300 with a stop above 29,000
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 26,879
Target price:
Protective stop:
Outlook
This index was capped by the Fibonacci 62% correction point of Jan 20’s decline and has been declining since then. It broke below the falling 20EMA and the gap support zone. This index closed below the channel yesterday as well. As long as the gap resistance zone is not filled, we could see more possible downside at the previous low of 26,000. Stochastic is moving lower. MACD is bearish and just had a bearish crossover.
Trading Idea
Look to sell at 27,100 for 26,100 with stop above 27,400.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 9189
Target price :
Protective stop:
Outlook
The index created a bearish Engulfing candlestick pattern on Jan 20. Price formed three black crows candlestick pattern, which is a trend reversal pattern. It has moved below the 20EMA and the bullish trend channel. We could see a possible return move back to test the trendline resistance at 9220. If price stays below 9220, it is likely to move lower towards 8930. Stochastic is turning down but MACD is still bullish at the moment.
Trading Idea
Wait for better trading Idea
S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 3252
Target price:
Protective stop :
Outlook
The index created a bearish Engulfing candlestick pattern. This index has formed a three black crows candlestick pattern last night, which is a trend reversal pattern It has moved below the falling 20EMA and hit its previous low at 3213. As long as 3213 support holds, we could see a move back to test 3296 or 3322. On the other hand, price is likely move lower towards 3155 if the support breaks. Stochastic is moving lower. MACD is still bullish and just had a bearish crossover.
Trading Idea
Wait for better trading idea.
