Friday's Rally Erases October Losses

Hello traders everywhere. Back in August, I wrote that we seem to "always be one tweet away" from either disaster or prosperity. Well, today we have prosperity after President Trump told reporters on Thursday that talks between the two countries were going "really well." His comments came after he tweeted that he would meet with Chinese Vice Premier Liu He at the White House on Friday. The meeting is scheduled to take place at 2:45 p.m. ET.

That comment and tweet have sent the stock market higher, erasing October's losses. The DOW was up almost 500 pts at one point but has settled around +400 pts up +1.6% on the week. The S&P 500 and NASDAQ followed suit rising +1.6% and +1.9%, respectively.

Bitcoin continues to trade right below its 200-day MA, but it did have a positive week gaining +2.3% trading around the $8,000 level. We are still looking for a move lower, and our key level to watch will be 7,714.70. A move below that level will trigger a red weekly Trade Triangle signaling a long-term downtrend. Continue reading "Friday's Rally Erases October Losses"

Q4, 2018: Is That You?

Hello traders everywhere. As I sit here and watch the DOW drop over 500 pts and the NASDAQ drop over 130 pts I can't help but think and feel like I've seen this before. Does this feel familiar to you?

If not it should, especially if you open a 1-year chart and look at Q4 2018. Yup, there it is, a significant drop to start Q4 of 2018 much like we see this week. The question is, will history repeat itself or is it just a short-term bump in the road.

Concerns around the economy were sparked on Tuesday after the Institute for Supply Management (ISM) said U.S. manufacturing activity fell last month to its lowest level in more than 10 years.

The weak data sent the major indexes tumbling on Tuesday, the first day of the fourth quarter. The Dow dropped more than 300 points while the S&P 500 slid 1.2%, their most significant one-day drops since Aug. 23. Those losses were enough to wipe out the Dow and S&P 500's gains for the entire third quarter. Both indexes had gained 1.2% in the previous quarter. Continue reading "Q4, 2018: Is That You?"

Time To Sell Chinese Investments

Hello traders everywhere. The stock market reversed course Friday afternoon erasing earlier gains after reports that the White House is considering limits on U.S. investment in China, aggravating the long-standing trade dispute between the globe's two largest economies.

Trump administration officials are discussing ways to limit U.S. investors' portfolio flows into China. One of those options includes limiting all U.S. investment in China.

The DOW turned flat, erasing a gain of about 130 points after the report. The S&P 500 also reversed all of its gains to trade down -0.5% amid losses in communications services, utilities, and technology. The Nasdaq is being hit the hardest dropping -1.1%.

Shares of Alibaba, Tencent, Baidu, and other Chinese companies, in particular, plunged on the latest U.S.-China headlines, with BABA falling -6%. Those shares all trade on Nasdaq which will now post a weekly loss of over -2% joining the other major indexes with weekly losses. The DOW will lose -.3, and the S&P 500 will lose -.9% on the week.

Key Levels To Watch Next Week:

Continue reading "Time To Sell Chinese Investments"

China Deal Trumps Impeachment Inquiry

Hello traders everywhere. Stocks rose Wednesday after President Trump announced that a U.S.-China trade deal could arrive sooner than expected. However, gains were kept in check as Wall Street assessed House Speaker Nancy Pelosi's announcement that she would launch a formal impeachment inquiry on Trump.

The Dow traded 180 points higher, the S&P 500 was up 0.2%, the Nasdaq climbed 0.30%, and the Dollar rose +.55% back above $99.

Keep an eye on the 50-day moving average for the three major indexes as the NASDAQ has broken below the MA, and the S&P 500 looks to be testing it, sitting just above its 50-day MA.

U.S. crude oil futures shed as much as -2.7% to $55.73 a barrel amid worries about weak demand and excess supply. Oil has since backed off that low but is still trading right around $56 a barrel.

Bitcoin has headed lower losing -3.2% on the day backing up the -11.4% loss on Tuesday, it's third-biggest daily loss of the year, testing its 200-day MA.

Key Levels To Watch This Week:

Continue reading "China Deal Trumps Impeachment Inquiry"

China Cancels Visit Causing Markets To Fall

Hello traders everywhere. Stocks fell to their lows of the day when news that Chinese trade officials canceled a visit to U.S. farms in Montana. Deputy trade negotiators from the U.S. and China resumed face-to-face talks for the first time in almost two months. The deputy-level trade talks are expected to help lay the groundwork for high-level negotiations early next month. This briefly lifted investor sentiment around trade talks.

Washington and Beijing have imposed tariffs on billions of dollars' worth of one another's goods since the start of 2018, battering financial markets and souring business and consumer sentiment.

The Dow traded 130 points lower, while the S&P 500 slipped 0.5% and the Nasdaq dropped 1%. For the week the major indexes will post their first weekly loss in over three weeks. The S&P 500 will lose -.30%, the DOW has the most significant losses with a loss of -.66%, and the NASDAQ brings up the rear with a weekly loss of -.49%. The Dow came into Friday's session 1.1% removed from its all-time high while the S&P 500 was 0.7% below its record mark from late July. The Nasdaq remained 1.9% away from its record.

Key Levels To Watch Next Week:

Continue reading "China Cancels Visit Causing Markets To Fall"