Global stocks tanked again on Friday as investors responded to further threats from China and from Trump. Whilst China prepares a sweeping blacklist of foreign firms following the Huawei ban, Trump, the self-proclaimed Tariff man opened up new fronts to his trade war by threatening tariffs on Mexico. Risk has been swiftly swiped off the table as the latest development send fear through the financial markets; markets are already jittery over the strength of global growth.
A bad end to a terrible month
These latest threats by China and the US have ensured a turbulent end to a pretty awful month.. The S&P is down 6% whilst the Dow continued its longest string of weekly losses since 201. The markets are finally waking up and smelling the bacon – Trump’s trade war is spiraling out of control. There is a level of unpredictability which the markets strongly dislike. With each new threat the possibility of a quick resolution drifts further away.
Dow levels to watch
The down continues to experience a series of lower lows. The 4-hour chart illustrates a strong bearish trend. A breakthrough resistance in region of 24810 could open the doors to a deeper decline to 24230. The Dow would need to break through resistance at 25225 to be within a chance of pushing towards 25400 and reversing the current downward trend.
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