Wall Street retraces early losses to end the day slightly lower

Facebook drags technology lower on Tuesday.
Amazon hits $1 trillion market cap.
Telecom falls more than 1% as Verizon loses over 2%.

Eren Sengezer FXStreet

Major equity indexes in the United States started the day on a negative note following the Labor Day weekend and failed to move back into the positive territory as investors are waiting for fresh development on NAFTA negotiations and the U.S. - China trade talks.

"The things that were on the market's radar last week, in a vacuum of other news, have taken center stage. The market is still in the first or second gear of getting to normal after the summer," Michael Antonelli, managing director of institutional sales trading at Robert W. Baird in Milwaukee, told Reuters.

After Barclay's downgraded the telecommunication giant Verizon's stock grade on Monday, the company's shares lost more than 2% and the S&P 500 Telecom Services Index dropped 1.12% to become the worst performing sector of the day. In the meantime, another 1% decline in the price of the barrel of West Texas Intermediate weighed on the S&P 500 Energy Index, which finished the day 0.3% lower.

In the meantime, the S&P 500 Information Technology Index failed to take advantage of the fact that Amazon's market cap hit the $1 trillion mark on Tuesday and closed 0.3% as it was dragged by the dismal performance of Facebook shares.

The Dow Jones Industrial Average lost 11.60 points, or 0.04%, to 25,953.22, the S&P 500 erased 4.73 points, or 0.16%, to 2,896.79 and the Nasdaq Composite dropped 18.31 points, or 0.23%, to 8,091.23.

DJIA technical outlook via FXStreet Chief Analyst Valeria Bednarik

The Dow daily chart indicates that buyers appeared on an approach to a firmly bullish 20 DMA, a few points below the intraday low of 25,804. Moving averages maintain their upward strength, all of them below the current level, although technical indicators continue easing within positive levels, the Momentum now pretty much flat in neutral readings and the RSI aiming modestly lower at around 61, rather reflecting the latest retracement than anticipating additional declines ahead.

Shorter term, and according to the 4 hours chart, the index retains the neutral-to-bearish stance seen on the previous updates, as the index remains unable to surpass a mild-bearish 20 SMA, trading a few pips below it, while technical indicators remain attached to their midlines with no clear directional strength.

Support levels: 25,926 25,877 25,828

Resistance levels:25,989 26,033 26,087

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

AUD/USD consolidates above 0.7200 after hot Chinese CPI data

AUD/USD is extending its consolidative price action above 0.7200 during the Asian session on Wednesday, uninspired by hot Chinese CPI and PPI data. Meanwhile, rising RBA rate-hike bets act as a tailwind for the Aussie amid Yen-inspired US Dollar weakness. Traders await the release of US inflation figures later in the week for fresh impetus.

USD/JPY stays in red near 153.50 amid aggressive BoJ hike bets

USD/JPY keeps the bearish tone intact at around 153.50 during European trading hours on Wednesday. A strong Reuters Tankan business survey adds to the case for continued BoJ policy normalisation and supports the Japanese Yen. This, along with a broadly weaker US Dollar, keeps the pair close to a nearly seven-month low set on Tuesday.

Gold bounces up to $4,400 with the bearish trend intact

Gold trims losses with price action returning to the $4,400 area during the European morning session, after bouncing from $4,345 lows on Tuesday. The precious metal is drawing support from broad-based US Dollar weakness, although the broader trend remains bearish, after losing more than $100 in the previous three trading days.

Pi Network's rebound holds as momentum improves

Pi Network (PI) extends its recovery on Wednesday, trading above $0.098 after finding support around the 50-day Exponential Moving Average earlier this week. The rebound comes as the Pi Core Team highlights the importance of strengthening its developer ecosystem to expand application-level utility across the network.

Oil, Apple and JPY in focus

Oil prices are rising on Wednesday as tit-for-tat strikes between Iran and the US threaten oil supplies as the two sides battle for control of the Strait of Hormuz. Stock futures have switched their attention from a strong earnings season to the challenges ahead, including a 10-year Treasury yield that is hovering close to the 4.8% level.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.