Market News
- U.S. three stock indexes closed over 1% higher on Tuesday as labour cost data encouraged investors about the Fed’s aggressive approach to taming inflation a day ahead of the central bank’s critical policy decision.
- U.S. labour costs increased at their slowest pace in a year in the fourth quarter as wage growth slowed. The U.S. central bank is expected to hike the Fed funds rate by 25 basis points, continuing the year 2022 path in which the Fed aggressively boosted rates to control soaring inflation.
- Japan’s factory activity held steady at 48.9, below the 50-point mark separating growth from contraction, logging another contraction in January, marking a third straight month of contraction.
Market Views
- Asian markets were higher on Wednesday morning as investors looked ahead to the Fed’s Wednesday meeting, as well as some economic data in the region. Hang Seng index rose 97 points and Nikkei 225 index gained 48 points.
- China’s factory activity in January signaled a further contraction from previous readings, albeit at a slower pace, marking the sixth monthly contraction in a row. Both manufacturing supply and demand continued to shrink last month.
Dow Jones Index
(CFD Symbol: US30)
Trend:
Recommendation:
Last: 34,005
Target price:
Protective stop:
Outlook
Price managed to stay above the 20EMA which is acting as support at the moment. The next resistance lies at 34,330. Stochastic remains weak. MACD is bullish but appears to have losing strength.
Trading Idea
Wait for better trading idea.
Nikkei 225 Index
(CFD Symbol: JP225)
Trend:
Recommendation:
Last: 27,339
Target price:
Protective stop:
Outlook
This index has reached its support-turned-resistance level. A price correction to the 20EMA at 26,910 is likely to follow if price is unable to surpass this resistance zone. Stochastic is at the overbought zone and a bearish MACD crossover is likely.
Trading Idea.
Wait for better trading idea.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend:
Recommendation:
Last: 12,043
Target price:
Protective stop:
Outlook
Price was capped by its previous price high resistance zone that capped price rally for the past fourth times. We could see a price decline if it is unable to surpass this resistance zone. Stochastic is at the overbought zone and a bearish crossover is likely.
Trading Idea
Sell 12,140 for 11,700 with a stop above 12,300.
FTSE 100 Index
(CFD Symbol: UK100)
Trend:
Recommendation: Long @ 7720
Last: 7781
Target price: 7860
Protective stop: 7720
Outlook
Price is currently consolidating at the 20EMA support zone. As long as price stays above the 20EMA, the uptrend remains intact and we could see price testing its high again. Stochastic could be turning up and MACD remains bullish.
Trading Idea
Buy 7720 for 7860 with a stop below 7650. Entry level was filled on 25 Jan. Lifted stop to break-even at 7720 on 1 Feb.
