Market News
- U.S. stocks closed higher for a second straight day on Thursday on mounting optimism that a U.S. debt ceiling deal could be reached within days, with discount retailer Walmart providing additional support after an upbeat annual sales forecast.
- The benchmark S&P 500 index rebounded from early declines on news that top U.S. congressional Republican Kevin McCarthy said a deal to raise or suspend the debt ceiling could potentially be reached in time to hold a House vote next week.
- President Joe Biden and McCarthy reiterated their aim to strike a deal soon to raise the $31.4 trillion federal debt ceiling and agreed to talk as soon as Sunday. The debt ceiling has drawn attention away from uncertainty about Fed’s stance on interest rates.
Market Views
- Asian markets were mixed on Friday morning over raising the U.S. debt ceiling, although concerns over a slowing economic recovery in China and a hawkish Fed kept gains limited. Hang Seng index fell 189 points while Nikkei 225 index gained 263 points.
- The Hang Seng was pressured by losses in e-commerce giant Alibaba Group, which tumbled 5.3% after its first-quarter revenue missed estimates. The group is facing slowing demand in China as the country’s digital markets mature and as it faces increased competition from other players.
Dow Jones Index
(CFD Symbol: US30)
Trend:
Recommendation:
Last: 33,559
Target price:
Protective stop:
Outlook
Price rebounded from its previous low support zone with a bullish engulfing candlestick pattern. However, there is a nearer resistance at 33,744 that price has to breakthrough for 34,260. There is a bullish Stochastic crossover. MACD is rising towards the zero line.
Trading Idea
Wait for better trading idea
Hang Seng Index
(CFD Symbol: HK50)
Trend:
Recommendation:
Last: 19,461
Target price:
Protective stop:
Outlook
This index is trading near to its lower boundary of the sideway consolidation zone. We think that price has higher chance to break down this consolidation zone to 18,810. The 20EMA is falling and the MACD remains bearish.
Trading Idea.
Sell 19,840 for 18,850 with a stop above 20,000.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend:
Recommendation: Short @ 13,450
Last: 13,862
Target price: 13,230
Protective stop: 13,520
Outlook
Price hit its Fibonacci 261% projection level today after the breakout. As price is trading far above the 20EMA and the Stochastic is at the overbought zone, we think that price may have a correction to the 20EMA before the next strong movement.
Trading Idea
Sell 13,450 for 13,230 with a stop above 13,520. Entry and stop orders were filled on 17 May.
FTSE 100 Index
(CFD Symbol: UK100)
Trend:
Recommendation: Short @ 7772
Last: 7766
Target price: 7670
Protective stop: 7820
Outlook
Price was resisted by its overhead 20MA resistance point. As long as it moves below the 20MA, we are likely to see price testing 7564. Stochastic remains weak and MACD is still bearish at the moment.
Trading Idea
Sell 7772 for 7670 with a stop above 7820. Entry order was filled on 18 May.
