On May 23, favorable labor market and manufacturing data led to a doji star in the U.S. stock market. What's the outlook for the future?
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Last night, the U.S. reported that the number of initial jobless claims unexpectedly dropped to 227,000 (the lowest level in four weeks), lower than the market expectation of 230,000 and the previous value of 229,000, indicating that the labor market remains healthy. The preliminary readings of S&P Global Manufacturing PMI and Services PMI for May both significantly surpassed expectations and previous values, and were above the 50 boom-bust line, suggesting that despite increased uncertainty in trade policies, the U.S. economy continues to grow. The initial release of the data boosted confidence in a "soft landing" for the economy, with the U.S. dollar index and U.S. stocks rising before retreating and maintaining a narrow range. The market believes the rebound in May's data may be related to companies ramping up production in anticipation of potential tariff issues.
However, the market is more focused on the progress of Trump's tax cut bill and the U.S. Treasury auction. The long-term impact of the U.S. credit rating downgrade has not yet been fully reflected in the stock market, and risks that are "not priced in" need to be watched.
$Dow Jones Industrial Average(.DJI.US) fell 1 point to close at 41,859.
$S&P 500(.SPX.US) fell 2 points, with an intraday fluctuation of 53 points, closing at 5,842. The key support level is 5,773, and it needs to hold above 5,880 to continue the rebound.
$NASDAQ Composite Index(.IXIC.US) rose 0.28% to close at 18,925, with the low of 18,840 just 9 points above the neckline of 18,831 (the neckline is the bull-bear divide and also the low on January 13).
The VIX briefly surged to 22.07 during the session before retreating to 20.28 at the close, indicating lingering caution in the market.
In the short term, the market remains bearish. We maintain a 30% position and have also bought inverse ETFs to hedge some of the portfolio risks. For those with heavy positions, it is advisable to reduce or cut losses on some positions to leave more flexibility for the future.
$Apple(AAPL.US) fell 0.36% to close at $201.36. Concerns over tariffs and economic outlook weighed on the stock. The support at $200 is being watched, with a high probability of breaking.
$Tesla(TSLA.US) rose nearly 2% to close at $341.04, fluctuating in the $330-350 range. Technically, the chance of breaking $350 is increasing, but we choose to wait and see.
$NVIDIA(NVDA.US) rose 0.78% to close at $132.83. It is expected to remain volatile ahead of the earnings report on May 28, but betting on earnings is not recommended.
$Alphabet - C(GOOG.US) hit a session high of $178.13 before closing at $171.98, up over 1%. The K-line formed an "inverted spinning top" pattern, digesting selling pressure above $170. Wait before buying.
Bitcoin remains volatile around $110k, with the upward trend intact. The stablecoin bill is also a positive catalyst. Watch for any weakening momentum; for now, wait and see.
$Hang Seng Index(00HSI.HK)
$Hang Seng TECH Index(STECH.HK)
$CSOP UST20(03433.HK)
$Proshares UltraPro Short QQQ ETF(SQQQ.US)
$FI2 CSOP HSI(07500.HK)
$iShares barclays 20+ Yr Treasury Bd(TLT.US)
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