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Stock markets collapse as trade war escalates significantly

The E-mini S&P 500 topped exactly at first resistance at 2903/05 and crashed below 2869/66 to fall almost another 100 points to 2775.

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After crashing 255 points from key trendline resistance at 3030/40 as the trade war escalates, we just bounced to the opening gap at 2822. Holding below 2820/25 targets first support at 2800/2795 before a re-test of 2775. A break lower is certainly possible for strong support at 2755/45. The brave can try long positions with stops below 2730. A break lower is an important sell signal targeting 2700/2695 and 2680/70.

Bulls need a break above 2835 for a recovery to 2845/50 and resistance at 2865/70. Gains are likely to be limited but above here look for strong resistance at 2895/2905.

The Nasdaq 100 crashed below 7760 for an important sell signal and through good support at 7670/65 for another sell signal, targeting more important eight-month trendline support at 7430/20.

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Even this did not hold with markets in freefall, and the Nasdaq crashed another 480 points yesterday. We have first resistance at 7340/50 but a move above 7370 targets strong resistance at 7410/20. Short positions need stops above 7440. A break higher targets 7475, then a selling opportunity at 7525/35, with stops above 7550.

Failure to beat first resistance at 7340/50 targets minor support at 7310/05 and 7275 before the low at 7225. From here down to 7200 is the most important support of the day. Long positions need stops below 7170. A break lower is an important sell signal and we could quickly drop another 100 points or more.

The E-mini Dow Jones break of 26290/260 was a sell signal targeting a buying opportunity at 26000/25980. We only stabilised here for a few hours before another sell signal targeting 25720/700, but we eventually crashed as far as 25032.

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Look for minor resistance at 25370/390, then strong resistance at 25550/580. Short positions need stops above 25600 for the next target of 25740/750 and strong resistance at 25880/920.

There is very minor support at 25285/255 before the low at 25050/030. The best support is at 25000/24900 so a break below 24800 is a sell signal, targeting important support at 25630/600.

Jason Sen

Technical Analyst & Trader

For more information and trading education visit Intertrader

The content of this article is the personal opinion of the author and not Intertrader. You should under no circumstances consider the information and comments provided as an offer or solicitation to invest. This is not investment advice. The information provided is believed to be accurate at the date the information is produced.

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