S&P 500 Breaks 23.8% Fibonacci, Cling Seng and Straits Instances Fall

S&P 500, HANG SENG, STRAITS TIMES INDEX OUTLOOK:

• S&P 500 index plunged 2.37%, possible breaking the 23.8% Fibonacci retracement degree at 3,250
• Cling Seng Index (HSI) opens 1% decrease, forming a possible “AB=CD” sample
• Straits Instances Index (STI) possible breaks a key assist at 2,500 and drifts decrease

S&P 500 Index Outlook:

The S&P 500 index had a massacre day as a number of headwinds put merchants on a defensive mode. A number of Fed members warned a prolonged financial restorationwith out signaling additional easing measures. Considerations remained on coronavirus resurgence in elements of the EU. Moreover, President Trump stated that the White Home might veto closing Meals and Drug Administration (FDA) guidelines for issuing an emergency-use authorization for a coronavirus vaccine, in keeping with Bloomberg Information. Coronavirus-linked headlines undermined a better-than-expected US Markit Manufacturing PMI studying, which got here at 53.5.

Rising demand for security boosted the US Greenback, which climbed for a 3rd day to 94.43 – the very best degree seen in two months. A surging US Greenback dampened valuable steel costs, and put stress on risk-linked currencies specifically AUD, NZD and NOK.

Asia-Pacific indices could observe their Wall Road friends decrease amid a comparatively quiet calendar day. Japan’s Nikkei 225 index opened down by 0.6%, and Australia’s ASX 200 index 0.35% decrease. Learn extra on our financial calendar web site.

IG Consumer Sentiment confirmed that retail merchants are leaning in direction of the shorting S&P 500 index, with 56% of positions internet brief, whereas 44% are internet lengthy. As markets fell, merchants added marginallengthy positions (+2%) in a single day. In comparison with per week in the past, merchants maintained brief bets unchanged whereas rising lengthy (+6%) positions.

Supply: DailyFX

All eleven S&P 500 sectors ended deeply within the purple, with vitality (-4.55%), data know-how (-3.21%), supplies (-2.93%) and actual property (-2.91%) among the many worst performers. A whopping 94.7% of the S&P 500 elements closed decrease.

S&P 500 Index Sector efficiency 23-9-2020

Supply: Bloomberg, DailyFX

Technically,the S&P 500 index has possible damaged a key assist degree at 3,250 – the 23.8% Fibonacci retracement. It dived additional into the decrease half of its Bollinger Band, with the band width widening. This will likely recommend that the bearish facet is probably taking management. The MACD indicator moved additional into the destructive territory, flagging the danger of extra downward stress. A right away assist degree will be discovered at 3,200, adopted by 3,050 – the 38.2% Fibonacci retracement.

S&P 500 Index – Day by day Chart

Cling Seng Index Outlook:

The Cling Seng Index (HSI) appears to be like set to open 1.5% decrease at round 23,350, in keeping with futures markets. Bearish sentiment from the US session could dampen danger urge for food in Hong Kong equities, with know-how, financials and actual property sectors in all probability among the many extra weak ones.

Technically, the HSI is probably going forming a bullish “AB=CD” sample (chart beneath), with a possible assist degree discovered at 23,000. A agency rebound from the “D” level could sign a possible development reversal. Nonetheless, additional decline beneath the “D” level might probably result in a take a look at of the 23.6% Fibonacci retracement degree at 22,900.

Cling Seng Index – Day by day Chart

Straits Instances Index Outlook:

Singapore’s Straits Instances Index (STI) lagged behind its international friends with a dismal year-to-date efficiency of -23%. It appears that evidently the worst shouldn’t be over but. The STI is likely to be inclined to a brand new spherical of selloff, albeit at a comparatively slower tempo, alongside US shares.

Technically, the STI has possible damaged a key assist degree at 2,500, and has since opened room for additional losses with a watch on 2,400. Its near-term momentum seems to biased in direction of the draw back.

Straits Instances Index – Day by day Chart

— Written by Margaret Yang, Strategist for DailyFX.com

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