DOW JONES RISES ABOVE MA5 ON U.S.-CHINA TRADE OPTIMISM
DJ 30 futures are currently trading at 25880- higher by 0.63% as compared to the previous close. The contract closed in the positive territory in the last trading session also.
In the Cash Markets, the DJIA was up 185 points as stocks of Boeing rose 2.41%. U.S. stocks rose today on encouraging headlines on U.S.-China trade negotiations and Chinese assurances of forthcoming economic stimulus.
Stocks will also be affected by Friday’s quadruple witching, the simultaneous expiration of stock-index futures and stock-index options, as well as individual stock futures and options.
Xinhua news agency reported earlier today that Chinese Vice Premier Liu He spoke with U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer. The report, according to The South China Morning Post, said: “The two sides have further made concrete progress on the text of the trade agreement between the two sides.”
The news comes after CNBC reported Thursday that Chinese negotiators suggest combining a state visit to the U.S. with the signing of a trade deal. Beijing wants a deal to be fully ironed out before President Xi Jinping meets with U.S. President Donald Trump.
Index-member Boeing’s shares rose after a report saying the company planned to roll out a software upgrade for its 737 Max aircraft. The stock had been under pressure all week after an Ethiopian Airlines flight using a 737 Max plane crashed on Sunday (March 10).
Other top gainers in the Dow Jones include Microsoft (up 1.95%), Intel (up 2.10%), and Apple (up 1.83%) at the time of writing.
The 30-stock index is set for a weekly gain of 1.8%. The gain would mark the biggest weekly gain for the index since the period ended Feb. 15, according to FactSet data. The benchmark rose more than 11% in 2019.
On the economic front, Industrial Production (MoM) for February released earlier today came in at 0.1%. The Production change was below the market expectation of 0.4%. January’s figure, however, was revised up to show a 0.4% drop, rather than a 0.6% decline as previously estimated. In addition, JOLTs Job Openings also out today came in at 7.581M. Openings were above the consensus estimates of 7.310M.
On the technical front, the RSI is currently at 57.29% and suggests that the market can move in the upward direction. The current price is above the MA5. The current price is above the middle line of the Bollinger Bands and is heading upwards.
Overall Bias is Positive and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Buy At 25865, Take Profit At 25965 Stop Loss At 25835