- U.S. market closed lower on Thursday with Nasdaq’s 2.5% drop leading the losses as investors took profits, particularly in technology stocks after a three-day rally, while multiple Federal Reserve officials were out talking about inflation and interest rate hikes.
- Several Fed officials spoke publicly about battling high inflation with Lael Brainard the latest, and most senior, U.S. central banker signaling that the Fed was getting ready to start raising rates in March.
- U.S. companies are due to report results on the final quarter of 2021 in the coming weeks with banks JP Morgan Chase, Citigroup and Wells Fargo set to start the ball rolling on Friday, while big technology companies report next week.
- Asian shares took a beating on Friday after a fresh salvo of hawkish remarks from Fed officials solidified expectations that U.S. interest rates could rise as soon as March, leaving markets braced for tighter monetary conditions. Hang Seng index fell 249 points and Nikkei 225 index slid 489 points.
- Oil prices edged lower as investors took profits after two days of gains amid fears of aggressive U.S. interest rate hikes, though the losses were partly offset by hopes of strong demand in a tightly supplied market over the longer term.
Dow Jones Index
(CFD Symbol: US30)
Last : 36,138
The recent price correction managed to find support the 20EMA for the past few days. The 20EMA is currently rising, suggesting the bullish price trend. As long as this index can stay above the 20EMA at 36,050, we are likely to test the Fibonacci 161.8% price projection target at 37,250. MACD remains bullish despite a bearish Stochastic crossover.
Look to buy at 35,950 for 36,650 with a stop below 35,600.
Hang Seng Index
(CFD Symbol: HK50)
Last : 24,193
This index managed to bounce up near to the previous low, creating a Double Bottom chart pattern. A price correction towards the 20EMA at 23,800 could be likely and as long as this support holds, the bullish trend remains intact. MACD is bullish now and Stochastic is rising.
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTEC)
Recommendation : Long @ 15,630
Last : 15,495
Target price : 16,000
Protective stop: 15,400
This index was resisted by the falling 20EMA that hints for a bearish price trend. Price has to move above the 20EMA at 16,000 for a change in trend and for more upside. 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. Entry price will filled on 13 Jan.
S&P 500 Index
(CFD Symbol: US500)
A Bearish Engulfing candlestick pattern was seen last night. Price is likely to test the rising trendline support again and it has to stay above this trendline to maintain the bullish trend. A violation of this trendline would trigger deeper correction. MACD is bearish but a bullish Stochastic crossover is likely.
Wait for better trading idea.