Market News
- U.S. stocks softened on Tuesday, closing in negative territory as investors began the holiday-shortened week by taking profits in the wake of a sustained rally amid signs of weakening global demand. Dow Jones fell 245 points, S&P 500 dropped 20 points and Nasdaq Composite lost 22 points.
- Investors now look to Powell’s two-day testimony before Congress, starting with the U.S. House Financial Services Committee on Wednesday, which will be scrutinized for clues regarding how long the central bank will keep its restrictive policy in place.
- Concerns over slowing global demand loomed larger after China cut its lending benchmarks to jump start sluggish demand, which offset a 21.7% surge in housing starts, the largest monthly jump in thirty years.
Market Views
- Asian stocks were mixed on Wednesday morning as caution kicked in ahead of a testimony by Fed Chair Powell, while investors also awaited more stimulus measures in China after an underwhelming rate cut. Hang Seng index slid 376 points while Nikkei 225 index rose 62 points.
- The minutes of the Bank of Japan’s April meeting showed that nine out of 10 members of the board had no intention of altering its ultra-loose policy in the near-term, and even the outlier suggested the bank wait before considering a change.
Dow Jones Index
(CFD Symbol: US30)
Trend:
Recommendation:
Last: 34,055
Target price:
Protective stop:
Outlook
Price retraced after hitting its previous price high resistance zone. We could see price testing its high at 34,570 again if it stay above the 20EMA. Stochastic remains strong at the overbought zone. MACD remains bullish.
Trading Idea
Wait for better trading idea.
Hang Seng Index
(CFD Symbol: HK50)
Trend:
Recommendation:
Last: 19,191
Target price:
Protective stop:
Outlook
Price broke and closed below the rectangle zone after being capped by its upper boundary resistance. It closed below the 20EMA as well. We are likely to see price continuing to move lower to 18,150. Stochastic is falling and MACD has a bearish crossover.
Trading Idea.
Sell 19,270 for 18,200 with a stop above 19,400.
Nasdaq 100 Index
(CFD Symbol: USTec)
Trend:
Recommendation:
Last: 15,688
Target price:
Protective stop:
Outlook
Price created a price high at 15,282 on 16 June. It has to further penetrate this high for upside, else, we are likely to see price correcting to the 20EMA at 14,640. Stochastic remains in the overbought zone. MACD remains bullish but is giving potential divergence warning.
Trading Idea
Wait for better trading idea.
FTSE 100 Index
(CFD Symbol: UK100)
Trend:
Recommendation: Long @ 7636
Last: 7571
Target price: 7780
Protective stop: 7450
Outlook
Price managed to stay above its previous low support zone for fourth occasions. It has to break though the 20EMA resistance of 7607 for more upside. Stochastic is neutral. MACD is rising after having a bullish crossover.
Trading Idea
Buy 7636 for 7780 with a stop below 7450. Entry was filled on 16 June
