More downside seen in stocks
Trade concerns weigh on sentiment
US500 falls beneath 3100 handle
It’s looking like a pretty ugly open for US indices with futures trading firmly in the red ahead of the cash session after Donald Trump poured more fuel on his recently reignited trade fire. The self proclaimed Tariff man shocked investors yesterday when he announced tariffs on imports of Steel and Aluminum from Brazil and Argentina before this morning doubling down on this new offensive by suggesting that he is in no hurry to reach a deal with China and it may be better to wait until after the 2020 election next November.
The past 24 hours have seen over 11 days of gains handed back as investors have seemingly woken up to the risks on the trade front. Source: xStation
The economic calendar is light this afternoon and given that Trump has already made one big announcement today, there’s a chance that we don’t get too much by the way of market moving news in the forthcoming session. With the market down by over 65 points in the past day and a half there’s a case to be made that sentiment may have swung too pessimistic in the short term. Trying to pick a bottom in a falling market is a notoriously tricky endeavour and those who do should be sure to have well placed stop losses to ensure this decline doesn’t turn into a rout. Recent lows around 3088 can be seen to give the first point of reference.
The US500 has now moved firmly below its 10 day SMA which is showing a negative gradient for the first time in almost 2 months. Should the decline take hold further then the region that the market broke higher from in late October around 3030 could be of interest - this also coincides with the 50 day SMA. Source: xStation