Dow Jones Industrial Average (.DJI) falls as investors eye progress in this week’s renewed U.S.-China trade talks

Dow Jones Industrial Average (.DJI) falls as investors eye progress in this week’s renewed U.S.-China trade talks

Dow Jones Industrial Average (.DJI) falls as investors eye progress in this week’s renewed U.S.-China trade talks

Stocks were mixed on Monday, Feb. 11, as investors eyed progress in this week’s renewed U.S.-China trade talks.

U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer arrived in Beijing for trade talks Sunday that will focus on structural reforms and intellectual property protections in the world’s second-largest economy. Negotiators are racing to meet the March 2 deadline when tariffs on $200 billion worth of China-made goods could increase to 25% from 10%.

With that in mind, investors also will watch for any mention of risks from China tariffs from a host of retail-focused earnings this week, the final major round of reporting for the December quarter. Walmart Inc. (WMT – Get Report) , Home Depot Inc. , Lowe’s Cos., Coca-Cola Co. (KO – Get Report) , PepsiCo Inc. and Macy’s Inc. (M – Get Report) will be issuing earnings reports this week.

U.S. investors also will focus on talks between Republican and Democratic lawmakers this week as the two sides attempt to broker an agreement that will prevent another government shutdown on Friday.

Mick Mulvaney, acting White House chief of staff, said on Fox News Sunday that “the government shutdown is technically still on the table — we do not want it to come to that, but that option is still open to the president and will remain so.”

The Dow Jones Industrial Average was down 53 points, or 0.21%, to 25,053, the S&P 500 was up 0.07%, and the Nasdaq rose 0.13%.

Three of the Dow’s biggest losers were in the healthcare sector Monday, led by UnitedHealth Group, which fell 1.8%, while Pfizer Inc dropped 1.3% and Merck & Co. declined 1%.

Restaurant Brands International Inc. posted stronger-than-expected fourth-quarter earnings and boosted its 2019 dividend target to $2 a share as same-store sales for its Tim Hortons division led gains for the company. The stock rose 1.6%.

Restaurant Brands said adjusted earnings for the quarter were 68 cents a share, 1 cent ahead of Wall Street forecasts. Revenue rose 14.55% to $1.39 billion, a figure that fell largely in-line with analysts’ forecasts.

Burger King’s comparable sales rose 1.7%, Tim Hortons posted a same-stores sales increase of 1.9%, while Popeyes Louisiana Kitchen recorded a comparable-store sales increase of 0.1% in the quarter, missing expectations.

Restaurant Brands Tops Q4 Earnings, Boosts 2019 Dividend Target
Tesla Inc. was up 2.3% to $312.84 after Canaccord Genuity lifted its recommendation on the stock to buy from hold and raised its price target to $450 from $330.

The firm argued that electric vehicle penetration in markets around the world isn’t fully appreciated by investors on Wall Street. Canaccord also said it wasn’t concerned about an upcoming conversion of a bond issue, given Tesla’s solid operating cash flow levels and its current cash balance of around $3.7 billion.

“We believe the last two quarters and recent guidance for Q1 have removed significant concerns for both production capability and profitability of the critical Model 3. As such, we see a more stable 2019 with far fewer concerns for investors in the company,” said Canaccord analyst Jed Dorsheimer. “We view the recent string of price cuts as further proof that the cost cutting and right sizing that the company has undertaken are resulting in concrete movement towards the ultimate goal of an affordable $35,000 Model 3.”

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 24,596.46.

The projected upper bound is: 26,103.77.

The projected lower bound is: 24,014.62.

The projected closing price is: 25,059.20.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 37.1954. This is not an overbought or oversold reading. The last signal was a sell 1 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 58.86. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 31 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 39. This is not a topping or bottoming area. The last signal was a sell 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 27 period(s) ago.

Rex Takasugi – TD Profile

DJ INDU AVERG closed down -53.221 at 25,053.109. Volume was 33% below average (neutral) and Bollinger Bands were 25% narrower than normal.

Open High Low Close Volume___
25,142.81125,196.75025,009.10025,053.109 241,695,728

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 25,102.85 24,245.94 25,009.69
Volatility: 13 28 20
Volume: 324,979,040 369,090,208 325,503,424

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

DJ INDU AVERG is currently 0.2% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into .DJI (mildly bullish). Our trend forecasting oscillators are currently bullish on .DJI and have had this outlook for the last 20 periods.

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