Speculative retail trading to continue spread bearish sentiment in the market
GME share prices spiked higher in the pre-market after Robinhood managed to raise $1 billion from its existing customer and allowed limited trading of the GME stocks. Investors were bothered by the current event where hedge funds were forced to cover their position and cause a surge in GME share prices. The event might trigger covering in other share prices which could bring the market lower.
While lawmakers called for an investigation on the event, it seems the DJIA will start an eventually bearish pullback toward 30,000 or lower.
Asian & European Stock market
The Asian stock market pushed lower today. Japan stock market down 534.03 points (-1.89%) to 27,663.39, China stock market down 22.11 points (-0.63%) to 3,483.07 and Australia ASX 200 down 42.30 points (-0.64%) to 6,607.40 . The European stock market also under pressure. DAX Germany down 0.78%, UK FTSE down 1.25%, and Euro Stoxx600 down 1.04%.
Technical Analysis
Dow Jones Industrial Average (INDU)
DJIA made a bounce from the daily SMA 50 yesterday. The index might trade bearishly today as the index futures down nearly 200 points. We think the bearish correction will target 30,000 then 29,000 handles. If the bearish correction goes deeper then traders will observe the index reaction near the daily SMA 200.
Rocket Companies Inc (RKT)
RKT share prices trading inside a triangle pattern previously. The share prices have broken above the triangle pattern and currently making a bearish correction to retest it. If the share prices could bounce from the broken level then RKT is set to continue its bullish movement.
Starbucks (SBUX)
SBUX share prices moved lower and soon will reach the daily SMA 100. Traders could see there is a bullish trendline present near the averages. When SBUX shares prices testing both support levels, traders could consider entering long positions on bullish reaction. However, if the bearish pressure has strong momentum then traders could prepare near the daily SMA 200.