25 June 2018 (9:07 AM EDT)
European stock markets have increased their losses before the opening bell in U.S. stock markets. Futures of major U.S. indexes have also been trading with deep cuts, indicating a highly negative opening in US stock markets today.
Dow Jones futures are -170 points down at the time of writing, indicating that the index will open somewhere near its support level of 24,400.
This level happens to be near last week’s low mark. so, a negative opening for the week for Dow Jones and broader U.S. stock markets will spell a weak weekly trend and if the index falls below this last week’s low mark, then we can expect a deeper negative trend in it and broader U.S. stock markets.
For other major indexes too, last session’s low levels should be watched for trend indication. If any index finds support nearby and trades above its previous low, then that index/ stock will be range bound within last sessions’ trading range.
However, any stock or index that falls below previous low could see more losses in the session.
Day traders should wait till markets stabilize after initial opening volatility. Then observe if any support is forming near intraday support levels. For major indexes, these levels are given on our Pivot Trading page. Individual levels are here:
- Pivot Levels for Dow Jones
- Pivot Levels for Nasdaq 100
- Pivot Levels for Russell 2000
- Pivot Levels for S& P 500
U.S. stock markets may continue to trade lower through the sessions, since this trend is event-based (trade war between China- U.S.). It remains to be seen if technical supports will hold or if markets will break those support to fall further.
In any case, day traders should wait till markets create a trend after gap down opening, and then trade with that trend.