USA 500, H4
U.S. equities have snapped back and recovered some of last week’s losses after Treasury Secretary Mnuchin mentioned productive talks with China on trade, which tempered some of the frostier rhetoric from last week. This helped allay investor anxieties about prospects for an escalating trade way. Most stock markets rallied in Asia and Europe,while Dow is 308-points firmer,USA500 gained 43-points and NASDAQ rallied 106-points ahead of the opening bell, likely propelled yet higher on the back of “fair value” adjustments into the open. This come after a healthy but uneven rebounds in Asia and Europe.
Despite the rebound seen today for USA500, the stock is still traded within a sharp downtrend since mid of March, with the technical point of view suggesting that weakness is likely to continue. The RSI remain in low levels at 36, while the asset is traded in the lower Bollinger Bands pattern, and close to year’s lows and the 200-DAY MA. Therefore only a break above 2,663 – 2,678 area, could indicate that bulls are back.
Meanwhile, on the data front, February Chicago Fed national activity index released, which surged to 0.88 in February after falling to 0.02 in January (revised from 0.12), and to 0.22 in December (revised from 0.14) from November’s 0.25 (revised from 0.24). The current reading is the second highest since December 2006, bested only by December’s 0.90. Today’s reading boosted the 3-month moving average to 0.37 in February from 0.16 in January (revised form 0.17). Chicago Fed index however, did not have much of an impact to the market.
For the rest of the day, Fedspeak returns with an update from NY Fed dove Dudley who will be speaking on regulatory reform at the U.S. Chamber of Commerce (12:30 ET). Hawkish Cleveland Fed’s Mester will address “The Economic Outlook, Monetary Policy and Some Future Policy Considerations” late in the session (16:30 ET). And Fed VC for Supervision Quarles discusses consumer protection and credit well after the close (19:10 ET).
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Andria Pichidi
Market Analyst
HotForex
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