- Three major U.S. stock indexes gained ground on Tuesday with Nasdaq leading the advance as investors were relieved that Fed Chair Jerome Powell’s testimony to Congress did not include any major surprises.
- Powell sounded less hawkish than expected in testimony to Congress and told a congressional hearing on his confirmation for a second term at the helm of the central bank that the economy could handle the COVID-19 surge and tighter monetary policy.
- One note of caution was sounded and shares in vaccine-makers Moderna and BioNTech were dumped when the World Health Organization said that more research was needed about the efficacy of vaccines against Omicron.
- Asia Pacific stocks advanced on Wednesday morning, as investors digested the latest Chinese inflation data. Their U.S. equivalents also rose after Fed Chair Jerome Powell reiterated that the central bank would tackle inflation. Hang Seng index jumped 484 points and Nikkei 225 index surged 528 points.
- China’s consumer price index was up 1.5% in December compared to a year ago. Chief economist at Pinpoint Asset Management said lower inflation opens room for the government to loosen monetary policies further and the probability of interest rate cut is rising.
Dow Jones Index
(CFD Symbol: US30)
Recommendation : Long @ 36,500
Last : 36,285
Target price: 37,200
Protective stop: 36,150 Triggered
The recent price correction managed to find support at the 20EMA for the past two days. The 20EMA is currently rising, suggesting the bullish price trend. As long as this index can stay above the 20EMA at 36,000, we are likely to test the Fibonacci 161.8% price projection target at 37,250. MACD remains bullish. Stochastic is also strong and a bullish crossover is likely.
Buy 36,500 for 37,200 with a stop below 36,150. Entry was filled on 5 Jan. Stop was triggered on 10 Jan.
Hang Seng Index
(CFD Symbol: HK50)
Last : 24,206
This index managed to bounce up near to the previous low. This rally broke above the 20EMA resistance as well as closed the gap resistance that was created on 20th Dec 2021. 20EMA is currently rising, suggesting the bullish price trend. We are likely to see price moving higher to test Fibonacci 62% price resistance at 24,880. MACD is bullish now and Stochastic is rising.
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTEC)
Last : 15,840
Target price :
This index tested the previous low support on three occasions and formed a long bullish Hammer two days ago. This could be a sign that a rebound is likely. First resistance will be the 20EMA at 16,030, and the second at its previous high at 16,660. MACD and Stochastic are likely to have a bullish crossover that hints at potential upside soon.
Look to buy at 15,630 for 16,000 with a stop below 15,400.
S&P 500 Index
(CFD Symbol: US500)
The price correction was halted at the rising trendline support. A long bullish Hammer was formed two nights ago, hinting at a potential price rebound. Price has moved above the 20EMA and we are likely to see a rally towards its previous high at 4807. MACD is rising towards the zero line and a bullish Stochastic crossover is likely.
Buy 4700 for 4780 with a stop below 4665. Entry and stop were triggered on 10 Jan