U.S-China deal to materialize?

The stock market is hopeful for reconciliation between U.S and China on the trade issue. On Monday, U.S indices sharply lower after the report said President Trump administration ready to impose a tariff on all Chinese imports. Though, the President mentioned there will be “great deal” with China but warned more tariff inline if no deal reached.

DJIA futures slightly higher 77 points before market open and indicate higher opening. AMGN, BIDU, EBAY, EA, FB are among the companies to report earnings after market close.

Asian & European Stock market

Asian stock market rebound after previous day slump. Nikkei up 307.49 points (+1.45%) to 21,457.29, China stock market up 25.94 points (+1.02%) to 2,568.05, and Australia ASX 200 up 76.90 points (+1.34%) to 5,805.10. European stock market on the other side, move lower. DAX Germany down 0.46%, UK FTSE up 0.18%, Euro STOXX600 down 0.16%.

Technical Analysis

Dow Jones Industrial Average (INDU)

There is no end to the sell-off in U.S market yet and DJIA slide below daily SMA 200 accelerated. It is not a good time for the bull and we think the selling is not over yet. The level around 24,000 is the possible temporary floor for the bull before further downside.

Traders might want to stick to the defensive sector at the current time and trade only when there is strong bullish reversal pattern on the index.

Paypal Inc (PYPL)

The share prices is a strong candidate for the short position following the close below daily SMA 200. Traders could look for short position near the averages with stop order above recent high $87.57. If the bearish trend continues, we might see PYPL tumble to a level around $70.00