CFD Indices – Wall Street Tumble Following Rise In US Bond Yields

Market News

  • Wall Street’s main indexes tumbled on Thursday, with the Nasdaq index posting its largest daily percentage fall in four months, as technology-related stocks remained under pressure following a rise in U.S. bond yields. Apple, Amazon, Microsoft, Alphabet, Facebook and Netflix slid between 1.2% to 3.6%.
  • The benchmark 10-year Treasury yields hit a one-year high of 1.614%, which is higher than the S&P 500 dividend yield, wiping out the stock market yield’s strong advantage and prompting investors concerned about rich valuations to lock in profits on some high-flying growth stocks.
  • Data showed fewer Americans filed new claims for unemployment benefits last week as COVID-19 infections fell, but the near-term outlook remained unclear after winter storms wreaked havoc in the South this month.

Market Views

  • Stocks in Asia-Pacific fell sharply in Friday morning trade following an overnight drop on Wall Street as a rapid rise in bond yields rattled investor sentiment. Hang Seng index plummeted 698 points and Nikkei 225 index plunged 743 points.
  • Japan’s industrial output rose for the first time in three months in January thanks to a pickup in global demand, in a welcome sign for an economy still looking to shake off the drag of the coronavirus pandemic.

Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation : Long @ 31,300
Last : 31,458
Target price: 31,700 reached
Protective stop: 31,110

Outlook
Price rebounded from the 20EMA support three days ago but this rebound was short-lived. A bearish Engulfing was formed last night, wiping out the earlier gains. It is now testing the 20EMA support again at 31,350. If price can form a bullish reversal candlestick pattern again, there is still chance for price moving higher again. Else, a violation of the 20EMA could lead to a price decline towards 30,580. Stochastic is falling now but MACD is still bullish.

Trading Idea
Buy 31,300 for 31,700 with a stop below 31,110. Entry order was filled on 18 Feb. Profit order was filled on 25 Feb.

Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation :
Last : 29,495
Target price:
Protective stop:

Outlook
Price opened with a gap down today which bring price lower to the rising trendline support that formed since Dec 2020. It could be on the verge on forming a potential bullish Hammer, but we would like to monitor today’s closing for the confirmation. Once a Hammer is formed today, look forward for price closing above the top of the Hammer for price testing its high again. Stochastic is falling now. MACD is still bullish but there is a bearish crossover.

Trading Idea
Wait for better trading idea

Nasdaq 100 Index
(CFD Symbol: USTEC)
Trend :
Recommendation :
Last : 12,846
Target price :
Protective stop:

Outlook
Price has been declining after a bearish Engulfing candlestick pattern formed on 16 Feb. It hit its previous low support zone, which is also the Fibonacci 38% correction point of Nov-Feb 21’s price swing last night for the second occasions. Look forwards for price forming a reversal candlestick pattern at this support for a rebound ahead. A violation of this support could lead to a further price decline towards 12,430. Stochastic is falling now but is approaching to the oversold region. MACD is still bullish.

Trading Idea
Buy 12,800 for 13,250 with a stop at 12,410

S&P 500 Index
(CFD Symbol: US500)
Trend:
Recommendation:
Last: 3843
Target price:
Protective stop:

Outlook
Price tested the Fibonacci 50% correction for the third times today. Let’s see if it can sustain at this level for a rebound to retest its high again. A violation of this level will likely to bring price lower to 3778. Price is trading below the 20EMA at the moment. Stochastic is falling now but MACD is still bullish.

Trading Idea
Wait for better trading idea

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