CFD Indices – US Market Consolidates Ahead Of FOMC Announcement

Market News

  • U.S. stock market lacked direction for much of the day after the S&P 500 and Dow Jones closed at record highs on Monday. The S&P 500 ended lower on Tuesday, weighed down by energy and industrial stocks as investors awaited the result of the Federal Reserve’s two-day policy meeting.
  • Data showed retail sales dropped more than expected in February due to bitterly cold weather across the country. Another report indicated winter storms in Texas led to a plunge in U.S. factory output last month.
  • Fears about an overheating economy and a recent increase in interest rates have increased scrutiny on the Fed’s two-day meeting, where policymakers are likely to raise economic forecasts and repeat their pledge to remain accommodative for the foreseeable future.

Market Views

  • Asian stocks were higher on Wednesday despite a sell-off in U.S. stocks, as investors awaited the Federal Reserve’s meeting and whether the central bank will maintain near-zero interest rates amid the economy’s post-pandemic recovery. Both Hang Seng index and Nikkei 225 index rose 25 points.
  • Oil prices rose on Wednesday during Asian trading hours. U.S. crude was up 0.12% at $64.88 while Brent added 0.1% to $68.46. Crude oil fell as the market frets over the uneven global recovery in demand.

Dow Jones Index
(CFD Symbol: US30)
Trend :
Recommendation :
Last : 32,798
Target price:
Protective stop:

Price rebounded strongly after hitting the Fibonacci 62% key correction point of Feb’s rally on 4 March 2021. This index is now on a rally after penetrating above its previous high of 32,077. The 20EMA is rising currently, hinting of a bullish price trend. It is near to its overhead resistance at 33,020. Both Stochastic and MACD are strong and rising now.

Trading Idea
Wait for better trading idea.

Hang Seng Index
(CFD Symbol: HK50)
Trend :
Recommendation : Long @ 28,900
Last : 28,935
Target price: 30,100
Protective stop: 28,600

Price has been hovering at the Fibonacci 50% correction point of Dec 20-Feb 21’s rally. The 20EMA is acting as resistance at 29,220. There is potential divergence warning given from the MACD. If price can close above the 20EMA, we are likely to see price moving higher to retest its high at 31,114. Stochastic is rising from the overbought region but MACD has turned bearish.

Trading Idea
Buy 28,900 for 30,100 with a stop below 28,600. Buy entry was filled on 12 Mar.

Nasdaq 100 Index
(CFD Symbol: USTEC)
Trend :
Recommendation : Short @ 13,050
Last : 13,135
Target price : 12,300
Protective stop: 13,400

Price rebounded after hitting the Fibonacci 161% projection level. It has penetrated above the 20EMA and is going to test the overhead price resistance at 13,340. Stochastic is rising from the oversold region now. There is a bullish MACD crossover and both of its lines are moving higher.

Trading Idea
Sell 13,050 for 12,300 with a stop above 13,400. Entry order was filled on 16 Mar

Nikkei 225 Index
(CFD Symbol: JP225)

Last: 29,895
Target price:
Protective stop:

This index is moving along with the rising trendline that is acting as support at the moment. Price has penetrated above the 20EMA, hinting at potential upside ahead. Stochastic is turning up and there is a bullish MACD crossover. The MACD has turned bullish now. We are likely to see price moving higher to test its high at 30,723.

Trading Idea
Wait for better trading idea

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