U.S. Stocks 

Fundamental Analysis: 

Major U.S. stock indexes fell on Wednesday,18th August 2021, with the S&P 500 down by more than 1%.

Meanwhile, minutes from the July Federal Reserve’s 27th – 28th July meeting, which were released on Wednesday, 18th August 2021, indicate a willingness to start reducing asset purchases before the end of the year.

The Federal Reserve officials felt their employment benchmark for decreasing support for the economy “could be reached this year,” but appeared to disagree on other key aspects of where monetary policy should turn next in the transition from the pandemic crisis.

In addition, the released minutes of the Fed’s meeting also showed that some members expressed concerns over inflation and saw the need to prepare for it. Other members said it would take time to get the U.S. citizens back to work and the Fed would need to remain patient.

Investors are looking for signs of when the Fed will tighten its accommodative monetary policy, including tapering its bond purchase program. The bond purchase program has been a key support in the S&P 500 Index as it has roughly doubled from its low in March 2020.

On the other end, the stock market’s decline accelerated late in the trading session, pushing the S&P 500 down by about 1.8% from its record closing high as the index fell for the second consecutive trading session.

The Dow closed by 1.08% lower, the S&P 500 closed by 1.07% lower and while Nasdaq closed by 0.89% lower.

Technical Analysis: 

(Dow30，1-hour chart) 

Execution Insight: 

The Dow has formed a remarkable top reversal from the 35601-line. Today, we pay attention to the support of the 34870-line. If the Dow gains effective support at the 34870-line, then we will pay attention to the pressure on the 35110-line after its rebound. Once the Dow falls in strength, breaking the 34870-line, it will open up a greater downside potential. At that time, pay attention to the support of 34724 and 34477 positions.

Hong Kong Stocks 

Fundamental Analysis: 

All the important indices of Hong Kong stocks rose yesterday. As of yesterday’s closing, the Hang Seng Index rose by 0.47% and close at 25,867.01-points.

Among them, the Hang Seng Composite LargeCap Index rose by 0.71%, while the Hang Seng Composite MidCap Index and SmallCap Index rose by 0.26% and 0.79% respectively.

At the same time, the Hang Seng China Enterprises Index (HSCEI) rose by 1.11% while the Hang Seng Technology Index rose by 0.13%.

From the industry breakdown, most sectors rose, with the industrial and financial sectors performing the best, rising by 1.54% and 1.15% respectively.

Technical Analysis: 

(HK50，1-hour chart) 

Execution Insight: 

After the HK50 fell below the 25816-line, it moved towards the 25160-line. Today, the lower end remains concerned about the support of the 25160-line, while the top is still concerned about the suppression of the 25816-line. Once the HK50 rise above the 25816-line, it will then focus on the suppression of the 26535-line.

FTSE China A50 Index 

Technical Analysis: 

(A50，1-hour chart) 

Execution Insight: 

The A50 retested the 15666-line yesterday and fell back near to the 15184-line. Today, pay attention to the direction of A50’s breakthrough in the range of 15666 to 15184. If it falls below the 15184-line, it will open up further downside potential. At that time, pay attention to the support of the 14669-line. If it breaks through the 15666-line, it will open up further upside potential. With that, pay attention to the suppressing force on the 16163-line.

Disclaimer 
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