Market News
- Wall Street staged a furious rally in the waning moments of the session on Friday with all three major indexes jumping up 9.3% after Trump declared a national emergency to combat the rapidly spreading coronavirus.
- The Fed moved aggressively to buttress a world economy unravelling rapidly amid the coronavirus pandemic by slashing interest rates to near zero on Sunday. However, this move failed to boost the market sentiment and we had seen the U.S. stock market futures hit “limit down” levels.
- U.S. biggest banks will stop buying back their own shares, and will instead use that capital to lend to individuals and businesses affected by the coronavirus, an industry trade group said on Sunday.
Market Views
- Stocks in Asia Pacific were mixed in Monday morning trade as U.S. Fed slashed its benchmark interest rate to zero and launched a massive quantitative easing program in an emergency move on Sunday. Hang Seng index plunged 613 points while Nikkei 225 index gained 7 points.
- China released economic data on Monday morning that revealed the scale of damage caused by the coronavirus outbreak. Data showed a huge collapse in industrial production, retail sales and a jump in unemployment leading to worries of a recession.
- US indices futures have been halted on the CME as circuit breakers have been imposed as result of a price decline of 5% earlier today.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 21,980
Target price:
Protective stop:
Outlook
We have seen a further breakdown of this index as it broke below the low at 23,360 that supported the price decline for the three consecutive days. Price violated the weekly support at 21,466 as well, which is also near to the Fibonacci 161% projection level last night after the huge selloff. There is still no sign of divergence warning or sign of recovery as both of the MACD’s lines are still moving lower. Stochastic is at the oversold region and could be turning up. Price is likely to move lower towards 19,780.
Trading Idea
Sell 22,750 with a stop above 23,250 for 21,050
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 23,445
Target price:
Protective stop:
Outlook
This index broke below its Aug 19’s low, which coincide with the Fibonacci 127% projection level of the Feb 20’s decline last Thursday with a falling window. Price broke below a bearish Flag pattern as well, which is a sign of the continuation of the downtrend. As price was unable close above the gap last Friday, we are likely to see price moving lower to Fibonacci 161.8% target of 20,764. Stochastic is still weak. MACD is bearish and both lines are moving lower.
Trading Idea
Sell 23,850 for 22,150 with a stop above 24,800.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 7561
Target price :
Protective stop:
Outlook
Price gapped down last Monday and broke below its previous low at 8123 to a low of 7822. This low was taken out last Thursday during the huge selloff. We are likely to see a decline towards the Fibonacci 200% projection level at 6495 unless price can go above 8390. Stochastic is still weak at the moment. MACD is bearish and both of its lines are moving lower.
Trading Idea
Wait for better trading idea
S&P 500 Index
(CFD Symbol: US500)
Trend :
Recommendation :
Last : 2571
Target price:
Protective stop :
Outlook
This index gapped down and broke below its previous low at 2853. Price further broke below its Fibonacci 127% projection point at 2698 during Thursday’s huge selloff. We are likely to see further downside to 2310 if Friday’s low at 2398 is taken out. Only a close above 2905 would turn the chart picture bullish again. Stochastic is still weak at the moment. MACD is bearish with both lines are moving lower.
Trading Idea
Wait for better trading idea
