Easing trade restriction on Huawei weather the fear in the market

The market slumped after the U.S government placed a ban for U.S companies to do business with Huawei last week. But, the U.S government decided to ease the restriction and give Huawei 90 days extension to purchase American-made goods and give an update to existing customer’s. No parts and components allowed for purchase though. The move intended to minimize disruption for the company’s customer worldwide.

Trade wars update will continue monitored by traders and investors. Recently, nearly 200 footwear companies wrote a plea to President Trump to remove the tariff on imported goods from China.

Asian & European Stock market

Asian stock market continue mixed. Japan’s Nikkei down 29.28 points (-0.14%) to 21,272.45, China stock market up 35.36 (+1.23%) to 2,905.97, and Australia ASX 200 up 24.00 points (+0.37%) to 6,500.10. European stock market mostly higher. DAX Germany up 1.03%, UK FTSE up 0.72%, Euro STOXX600 up 0.66%.

Technical Analysis

Dow Jones Industrial Average (INDU)

DJIA could not breakout above 25,700 – 26,000 area yet and we have another close near 25,700. The index futures pointed upward more than 100 points and might trigger buying today. It is expected to test the resistance area again today. Will the index breakout above the resistance area? Alternatively, will it close below daily SMA 200 and start a new bearish trend?

Lam Research Corp (LRCX)

LRCX dropped below first Fibonacci retracement level ($190.91). The share prices might continue lower to test the lower level at $176.32 and daily SMA 100. Traders could prepare for long positions near the level if there is a bullish reaction.

Mckesson Corporation (MCK)

MCK holding out above the daily SMA 200 and slowly formed bullish patterns. We might see a bounce from the averages soon and traders could prepare for long positions.