U.S stock market rebound after Trump soften on China

The massive drop last week triggered after hard comment by President Trump regarding China’s Rare Earth policy. However, the situation changed as Trump posted that he may not follow-through on the tariff threat against China. Current situation is similar to the situation in April, which could turn worse or no more downward movement. As the Fed rate-cut is not far, traders might use each dip as a chance to add long positions at a lower level.

Dow Jones Industrial Average (INDU)

DJIA index bounced from the 38.2% Fibonacci Retracement level, erasing part of the losses after the sharp drop last Friday. The index might attempt to erase all the losses and continue the bullish trend. As we mentioned, the 38.2% – 68.1% Fibonacci Retracement area will become the focus for bounce reactions. If there is bearish continuation, then traders will expect another attempt to bring the index down to target orange trend line and 45,000 level.

Papa Johns International, Inc (PZZA)

PZZA share prices broken below a bullish trend line and might switch the trend bearish. However, we could see the share prices continue printing higher swing low with similar high. A triangle formation formed and still on progress for breakout. Traders will wait for a significant breakout from the triangle area to confirm the next direction. We maintain bullish scenario for the share prices for now until a new lower swing low printed on the chart.