CFD Indices – Hopes Of Stimulus Were Offset By Weaker US Data

Market News

  • U.S. stocks ended higher on Thursday as comments by U.S. President Donald Trump fueled hopes of fresh fiscal support, while data underscored the view that the labour market recovery was struggling to gain momentum. All three major indexes closed 0.43% higher.  
  • Two days after calling off negotiations on a comprehensive bill, Trump in an interview with Fox News said talks with Congress have restarted over further COVID-19 relief and that there was a good chance a deal could be reached. But he gave no other details about a possible agreement.
  • House of Representatives Speaker Nancy Pelosi said legislation to help airlines was a matter of national security and could only move through Congress with guarantees of work continuing on the comprehensive deal, pushing the Dow Jones airlines index jumped 1.6%.

Market Views

  • Asian shares were set to track Wall Street gains on Friday as revived hopes for a U.S. stimulus deal helped investors overlook weaker-than-expected jobs data and growing global coronavirus cases. Hang Seng index rose 21 points while Nikkei 225 index fell 33 points.
  • World Health Organization reported a record one-day increase in global coronavirus cases on Thursday, led by a surge of infections in Europe. Cases are also increasing in about 30 out of 50 U.S. states including New York, once the epicenter of the U.S. outbreak, which recently re-implemented school and business closures to stave off a second wave.

Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 28,584
Target price:
Protective stop:

Outlook
The Bearish Engulfing candlestick pattern that formed on 5 Oct was invalidated as this index has surpassed the Engulfing’s high. The 20EMA is rising and is acting as support at the moment. We are likely to see price move higher towards the previous high of 29,195. Stochastic is rising at the moment. MACD is still bearish but there was a bullish crossover.

Trading Idea
Buy 28,330 with a stop below 28,000 for 28,800.


Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 24.186
Target price:
Protective stop:

Outlook
Price is going to test the support-turned-resistance zone at 24,246 as expected. This could be a strong resistance and price will need to surpass this resistance for further upside to 24,900. A failure moves to penetrate above this resistance is likely to bring price lower again. Stochastic is turning up at the moment. MACD has turned bearish but there is a bullish crossover in the bearish side.

Trading Idea
Buy 24,200 for 24,850 with a stop below 23,920

Nasdaq 100 Index
(CFD Symbol: USTec)
Trend :
Recommendation : Long
Last : 11,612
Target price : 11,800
Protective stop: 11,350

Outlook
This index is now testing the Fibonacci 50% correction point of the Sept’s decline. If price can penetrate above 11,568, there is chance for this index to test 11,780. The 20EMA is rising at the moment. Stochastic is still moving higher at the moment. MACD is bearish but there is a bullish crossover.

Trading Idea
Buy 11,350 for 11,800 with a stop below 11,100. Order was filled on 2 Oct. Raise stop to cost at 11,350.


S&P 500 Index
(CFD Symbol: US500)
Trend:
Recommendation:
Last: 3365
Target price:
Protective stop:

Outlook
Price managed to close above the declining trendline and the 20EMA. As long as price stays above the declining trendline, we are likely to see price moving higher towards 3588. Stochastic is rising at the moment. MACD is bearish but there is a bullish crossover.

Trading Idea
Buy 3420 with a stop below 3390 for 3520.

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