Dow Jones Industrial Average (.DJI) lack of improvement in trade relations between the U.S. and China

Dow Jones Industrial Average (.DJI) lack of improvement in trade relations between the U.S. and China

Dow Jones Industrial Average (.DJI) lack of improvement in trade relations between the U.S. and China

U.S. stock index futures dropped for a second day as a lack of improvement in trade relations between the U.S. and China gave investors little reason to buy after equities languished in New York Thursday.

March futures slid as much as 0.9 percent on the S&P 500 Index as of 6:43 a.m. in London as Asian markets extended losses. Apple Inc. said a Chinese ban on the sale of some models of the iPhone will force it to settle a long and bitter licensing battle with Qualcomm Inc., according to a recent legal filing. Futures on the Nasdaq 100 Index and Dow Jones Industrial Average declined 1.1 percent and 0.8 percent, respectively.

“Trade issues are obviously worrying investors, and even as there had been progress between China and the U.S., there’s still a long way to go before that issue is resolved,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors. “The iPhone issue is probably not helping.”

China’s economic data on Friday also hurt investor sentiment, Seo Sang-young, a strategist at Kiwoom Securities, wrote in a note. China’s economy slowed again in November as retail sales and industrial production weakened, creating a challenging backdrop for policy makers who gather next week to set the tone for the year at their annual Economic Work Conference in Beijing.

Markets may be affected by a series of events next week including Micron Technology Inc. earnings and a statement from U.S. Federal Reserve, Seo said.

The S&P 500 Index finished the Thursday session little changed, with about three decliners in the benchmark for every two that rose. Utilities advanced, while banks came under pressure. The Dow Jones Industrial Average eked out a gain, led by Procter & Gamble Co. and McDonald’s Corp.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 25,321.11.

The projected upper bound is: 25,551.43.

The projected lower bound is: 23,556.27.

The projected closing price is: 24,553.85.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

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 42.8397. This is not an overbought or oversold reading. The last signal was a sell 6 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 43.66. 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 33 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 -40. This is not a topping or bottoming area. The last signal was a sell 6 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 sell 3 period(s) ago.

Rex Takasugi – TD Profile

DJ INDU AVERAGE closed up 70.111 at 24,597.381. Volume was 5% below average (neutral) and Bollinger Bands were 20% wider than normal.

Open High Low Close Volume___
24,575.85924,740.96124,473.28924,597.381 299,972,448

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

Moving Averages: 10-period 50-period 200-period
Close: 24,898.56 25,282.60 25,089.05
Volatility: 25 25 19
Volume: 384,161,088 363,159,328 332,938,496

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 AVERAGE is currently 2.0% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .DJI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .DJI and have had this outlook for the last 2 periods.

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