Risk Rallying on China News
The Nasdaq is on watch as we head into the weekend with the index on course to confirm a breakout above the bear channel from YTD highs. If the weekly candle closes above the 18,912.17 level, bulls will be in control when trading recommences next week. The index has seen a solid run higher this week, buoyed by a broad improvement in risk appetite. Indeed, it seems that traders are shrugging off uncertainty around Trump’s recent comments and instead choosing to be optimistic that a scaling back of China tariffs will materialise in coming weeks.
Boost for Tech Stocks
The prospect of an unwinding of tariffs on China is particularly encouraging for tech stocks given the bilateral trade between US and Chinese tech companies which has been placed under great strain as a result of the tariffs. News that China is reportedly considering a tariff exemption on some US goods has been taken as a further sign that the two sides are potentially moving towards a broader de-escalation of the trade war. Looking ahead, any further positive news on that issue is likely to see prices rally again near-term. However, any fresh hostility between the two sides could easily spark a fresh unwinding of tech stocks.
Technical Views
Nasdaq
The rally in the Nasdaq has seen price breaking out above the bear channel highs and above the 18,912.17 level. While price holds above this area, focus is on a test of the 19,955.14 level next, in line with bullish momentum studies readings.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.