Market News
- All three major U.S. stock indexes turned positive after clawing back losses on Monday as the Federal Reserve said it will buy individual corporate bonds just a month after it launched its corporate bond exchange-traded funds program. Dow Jones closed 157 points higher, S&P 500 rose 25 points and Nasdaq Composite was up 137 points.
- In another effort to support the credit market, the Fed will buy individual bonds with remaining maturities of five years or less on the secondary market. The move will see the Fed’s balance sheet take on more exposure to corporate debt just a month after the central bank kicked off its bond exchange-traded funds (ETFs).
- Investors were spooked after China re-introduced restrictions in some areas after Beijing reported its biggest cluster of new infections since February. New cases and hospitalizations in record numbers also swept through more U.S. states.
Market Views
- Asian shares rallied on Tuesday morning as the formal start of the Federal Reserve’s corporate bond buying programme boosted global investor sentiment and calmed earlier worries about a second wave of coronavirus infections. Hang Seng index jumped 640 points and Nikkei 225 index rose 714 points.
- Crude oil swung into positive territory on improving demand and signs Organization of the Petroleum Exporting member states and allies were complying with a production cuts.
Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 26,336
Target price:
Protective stop:
Outlook
The sharp correction was halted at the key Fibonacci 62% retracement point, which is also the gap resistance-turned-support zone. Price rebounded from this support zone and has now moved above the rising 20EMA. Stochastic is still strong and could be turning up. MACD is also bullish at the moment. We could see this index testing its high of 27,608 again as long as the low at 24,560 is sustained.
Trading Idea
Buy 25,800 for 26,900 with a stop below 25,500
Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 24,516
Target price:
Protective stop:
Outlook
Price has fallen inside the consolidation zone that ranged from 23,400 to 25,000 and we expect this index to move within this range, until either end of the range boundary is broken for the next directional move. The 20EMA is currently flat, suggesting that price is moving in sideways manner. Stochastic is turning down at the moment. MACD is bearish and a bearish crossover was seen
Trading Idea
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation :
Last : 9941
Target price :
Protective stop:
Outlook
The three days’ price decline was halted when this index hit the 20EMA, where it had provided support to the price. A bullish engulfing pattern was formed last night, suggesting a potential bottom. We are likely to see this index tests its all-time high at 10,155. Stochastic is falling at the moment. MACD is still bullish but a bearish crossover was seen.
Trading Idea
Wait for better trading idea.
S&P 500 Index
(CFD Symbol: US500)
Trend:
Recommendation:
Last: 3118
Target price:
Protective stop:
Outlook
This index was supported by the key resistance-turned-support zone at 2965. Last night, it ended the day with a bullish Engulfing candlestick pattern which hints of a potential low. Price moved above the rising 20EMA as well. We could see this index moving higher towards its all-time high at 3232 again. Stochastic is falling at the moment. MACD is still bullish at the moment but there is a bearish crossover.
Trading Idea
Wait for better trading idea.
