Summary:
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Risk-off moves seen after trade tweet
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“Mood in Beijing about trade deal is pessimistic”
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US500 earlier made new ATH at 3127
It’s been a fairly eventful start to the week for US indices with the S&P500 futures hitting their highest ever level before experiencing a fairly swift move lower in recent trade. With a thin economic calendar and earnings season winding down any sharp moves were always likely to come from trade headlines and this has proven to be the case. A tweet from Eunice Yoon, a senior Beijing correspondent for CNBC has poured some cold water on market sentiment and serves once more as a reminder that for all the positive noises on the US-SIno trade front in recent months, this situation remains far from remedied.
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Negative reports on US-China trade are weighing on sentiment ahead of the US open. Source: Twitter
US benchmarks ended last week at their highest ever levels with a strong rally into the weekend and even though doubts remain on trade, the price action has been anything but bearish. Even the recent selling on the above tweet has been fairly measured and the markets trade only 10 points from their all-time highs - which were made earlier today at 3127. Even after the dip the S&P500 is back around the level it ended last week and set for a record opening price.
The US500 has made a steady move higher for much of the past 6 weeks with little by the way of any pullbacks. The recent record highs of 3127 are an obvious place to watch for any possible resistance and if it does hold then fib retracements can be used for potential profit targets with the 23.6% fib coming in at 3063. The Stochastic oscillator has printed a potential bearish cross but with the current H4 candle still open this has yet to be confirmed by price action. Source: xStation
