Stock futures pointed lower as worries about global economic growth rising
Traders and investors welcomed a major comeback in the stock market yesterday after the major indices staged a bullish reversal. Initially, the market was down nearly 400 points but managed to close the day up 369 points. However, the bullish reversal seems short-lived as the DJIA futures are currently lower by more than 200 points.
China’s situation is the major driver of the current bearish sentiment as the country’s covid cases increase to a record level. Lockdown in China will deepen the world supply chain trouble which drive inflation further upward. Similar to the previous outlook, traders will continue to stay cautious and wait for a better level when entering long positions in the stock market.
Dow Jones Industrial Average (INDU)
DJIA index formed a bullish reaction yesterday near the trendline and closed the day on the bullish side. Despite the bullish reaction, the market is set for another bearish movement today as the DJIA futures lower 204 points. We think the bearish trend will continue and traders might want to avoid long positions for now.
Alcoa Corporation (AA)
AA share prices are in a full bearish pullback from the top. The share prices have reached the daily SMA 200 and now extend the bearish movement toward the daily SMA 200. Traders will focus on the share prices reaction near the support levels, especially the $57.50 – $64.00 area. If the bearish pressure receded then there is a chance for traders to enter long positions with a stop below $50.00.