U.S stock market set to bounce after previous day steep drop

The DJIA futures pointed upward 45 points at the current time and will attempt to bounce after the previous day steep drop. Yesterday drop is a massive drop compared to 2018 drop. Coronavirus cases continue to spread across the world especially in South Korea, Iran, and Italy. Investors and traders fleeing from the market as the growth outlook will be impacted.

If a bounce happen then traders might be better to wait sideline for now. A bounce might be a temporary reaction before further downside.

Asian & European Stock market

The Asian stock significantly lower. Japan’s stock market down 781.33 points (-3.34%) to 22,605.41, China stock market down 18.18 points (-0.60%) to 3,013.05 and Australia ASX 200 down 111.70 points (-1.60%) to 6,866.60. The European stock market under pressure. DAX Germany down 0.48%, UK FTSE down 0.74%, Euro STOXX600 down 0.55%

Technical Analysis

Dow Jones Industrial Average (INDU)

DJIA corrected sharply yesterday as coronavirus spread across the world. The rate of infection increase is alarming and should continue to put pressure on the DJIA index. Today, the index will test the daily SMA 100 and attempt to bounce from it. If recovery happens it might last for a short period. Traders might want to avoid long-term positions for now.

Advanced Micro Devices (AMD)

AMD share prices have started a bearish correction. The share prices recently hit $59.27 high above the top of the channel. The bearish correction has reached the bottom of the channel or daily SMA 50. If AMD could maintain the position inside the channel or above SMA 50 then we will expect a bounce to happen.