- Wall Street’s major indexes fell on Tuesday, dragged by weakness in tech stocks such as Apple and Amazon, after comments from Fed Governor Lael Brainard spooked investors about potential aggressive actions by the central bank to control inflation.
- Brainard said she expects methodical interest rate increases and rapid reductions to the Fed’s balance sheet to bring U.S. monetary policy to a “more neutral position” later this year, with further tightening to follow as needed.
- Data showed U.S. services industry activity picked up in March, boosted by the rolling back of pandemic restrictions, but businesses continued to face higher costs as supply strains persisted. Chinese authorities extended a COVID-19 lockdown in Shanghai to cover all of the financial centre’s 26 million people as well.
- Asian share markets skid on Wednesday morning as investors faced up to the possibility of aggressive monetary tightening by the U.S. Fed to fight inflation, while focus was also on new Western sanctions against Russia over its invasion of Ukraine. Hang Seng index fell 340 points and Nikkei 225 index dropped 500 points.
- U.S., European Union (EU) and Group of Seven are coordinating on a fresh round of sanctions on Russia, which could isolate the country even further and increase the war’s economic impact, including a U.S. ban on investment in the country, an EU ban on coal imports and increased penalties on financial institutions.
Dow Jones Index
(CFD Symbol: US30)
Recommendation: Long @ 34,875
Target price: 35,850
Protective stop: 34,300
Price is having a correction after forming an Evening Star candlestick pattern. It is currently testing the 20EMA support and if this support holds, we can see price rebounding higher. A violation of 20EMA will send price lower and hints at a further correction.
Buy 34,875 for 35,850 with a stop below 34,300. Entry order was filled on 31 Mar
Hang Seng Index
(CFD Symbol: HK50)
Price is penetrating the gap resistance zone that formed since early March. If price is able to maintain above this resistance zone, we see price moving higher towards 24,720. Stochastic is at overbought region. MACD is bullish.
Buy 22,050 for 23,400 with a stop below 21,450.
Nasdaq 100 Index
(CFD Symbol: USTec)
Price is trading near to its previous price high resistance level. It is testing the 20EMA support and if this support holds, we see price moving higher towards 15,840. Stochastic is at the overbought region and MACD is bullish.
Wait for better trading idea.
S&P 500 Index
(CFD Symbol: US500)
Price is having a price correction and is likely to test the 20EMA support at 4488. If price able to hold at 20EMA, we see price moving higher towards 4700. Stochastic is falling but MACD is bullish.
Buy 4455 with a stop below 4410 for 4635.