NASDAQ Composite (.IXIC) rebounding dramatically from the sell off
We finished up yesterday with broad based gains on all three major markets rebounding dramatically from the sell off on Tuesday when the market were doubting that any progress would be made on the trade front.
The catalyst for buying was fueled by a report that the Chinese were willing to reach a partial or “skinny” deal that would have them agreeing to buy more agricultural products from the U.S. in exchange for no further tariff increases on goods imported from their country.
The Nasdaq finished +1.0% while the S&P 500 rose +0.9% and the Dow climbed +0.7%. The irony of all of this was the President Trump a day earlier stated that he was not interested in a temporary or partial deal.
This morning markets got off to a rocky start as conflicting reports over night whipsawed the futures market. Early yesterday evening, a report out of The South China Morning Post stated that lower level negotiations had not progressed and that the Chinese delegation was now planning on leaving today.
The issue of forced technology transfers, which China refused to put on the table, was the reason talks were at a standstill. The White House quickly dismissed the SCNP article as inaccurate and stated that they were unaware of any change in Vice Premiere Liu He’s plans.
Bloomberg then reported that a partial trade agreement could be struck where the US would suspend next week’s tariff increase in exchange for a currency pact. This is the fourteenth meeting on trade between the two countries.
At this point a partial deal would be good, not great, as a broad based full deal is very unlikely One thing is for sure in this modern day “As The World Turns” soap opera is that it will change again….and again. And right on cue a defiant tweet from President Trump has put a charge back in the market.and reversed all the early morning negativity.
He stated, “Big day of negotiations with China. They want to make a deal, but do I? I meet with the Vice Premier tomorrow at The White House.” While a little ambiguous, it did confirm that negotiations will extend into Friday.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 7,986.04.
The projected upper bound is: 8,249.62.
The projected lower bound is: 7,642.96.
The projected closing price is: 7,946.29.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 55.6924. This is not an overbought or oversold reading. The last signal was a buy 11 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 48.18. 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 90 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 -10. This is not a topping or bottoming area. The last signal was a buy 1 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 12 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed up 47.040 at 7,950.782. Volume was 18% below average (neutral) and Bollinger Bands were 7% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 7,912.22 7,979.56 7,749.62
Volatility: 22 24 22
Volume: 497,035,904 548,755,776 562,472,064
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.
NASDAQ COMPOSITE is currently 2.6% above its 200-period moving average and is in an downward trend. Volatility is Our volume indicators reflect moderate flows of volume out of .IXIC (mildly bearish). Our trend forecasting oscillators are currently bearish on .IXIC and have had this outlook for the last 6 periods.