NASDAQ Composite (.IXIC) tumbled as optimism faded over the outcome of trade talks
U.S. stocks tumbled on Tuesday as optimism faded over the outcome of trade talks after a report the Trump administration was moving ahead with efforts to limit capital flows to China and the inclusion of Chinese firms to a blacklist.
The declines were broad-based, with the 11 major S&P 500 sectors trading lower and all the 30 components of the blue-chip Dow Jones index in negative territory.
Adding to the pessimism was a South China Morning Post report that said China had toned down expectations ahead of the high-level talks set to begin on Thursday, and that the Chinese delegation could depart Washington a day earlier than planned.
“The headlines are painting a picture of a less optimistic tone to the trade talks this week,” said John Zaller, chief investment officer of MAI Capital Management in Cleveland, Ohio.
“Investors are not expecting a big deal or a small deal this week, but anything less than a tariff delay would be a pretty big disappointment for the markets.”
The U.S. widened its trade blacklist to include Chinese video surveillance firm Hikvision 002415.SZ and surveillance equipment maker Zhejiang Dahua Technology 002236.SZ among others, drawing a sharp rebuke from Beijing.
This pressured U.S. suppliers. Intel Corp INTC.O, Nvidia Corp NVDA.O, Western Digital WDC.O and Seagate Technology STX.O fell between 1.7% and 4%, while Ambarella Inc AMBA.O slumped 9%.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 7,987.09.
The projected upper bound is: 8,117.13.
The projected lower bound is: 7,511.64.
The projected closing price is: 7,814.39.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.
A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 5 falling windows in the last 50 candles–this makes the current falling window even more bearish.
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 63.8094. This is not an overbought or oversold reading. The last signal was a buy 9 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 40.99. 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 88 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 -101.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 2 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 10 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed down -132.516 at 7,823.778. Volume was 14% below average (neutral) and Bollinger Bands were 4% 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: 7,937.58 7,991.45 7,732.98
Volatility: 22 24 22
Volume: 513,232,928 557,280,064 569,477,504
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 gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
NASDAQ COMPOSITE is currently 1.2% above its 200-period moving average and is in an downward trend. Volatility is Our volume indicators reflect volume flowing into and out of .IXIC at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .IXIC and have had this outlook for the last 4 periods.
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