Friday, November 8, 2019



Fundamental Highlights

US indices traded higher on Thursday as positive trade headlines drove up risk appetite. News that China and the US agreed to gradually roll back tariffs on one another revived hopes of trade progress and improved the global economic outlook. Until the news materializes, US equities will remain at risk of any conflicting trade headlines as the nature of US-China trade relations is known to be unpredictable. In terms of data, US initial jobless claims came in at 211k, lower than expected. Earlier today, China published better than expected trade data which should provide support. Later the US publishes Michigan consumer sentiment figures which are estimated to tick higher. Apart from the data, market sentiment and price action will be largely determined by additional trade headlines.

Technical Analysis

The Dow broke out of its range to the upside and overcame the high at 27498 to record a fresh peak at 27742. The price rose by 250 points before closing with a gain of 182 points at 27674. Today, Dow futures are pointing lower and a decline below the 27600 level would be required to indicate selling pressure and lead the Dow towards the lower levels at 27560 followed by 27500 near the 20-period MA. The uptrend remains intact unless we see a break below 27370 which would signal a wider retracement and impair the bullish view. Meanwhile, trading above the 27742 all-time high would be required to signal a bullish continuation.

Support: 27600/ 27500
Resistance: 27742/

Chart (H4)