News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
Wall Street
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • RT @FxWestwater: Japanese Yen Forecast: JPY Crosses Eye BoJ, CPI as Haven Flows Bolster Yen Strength Link: https:/…
  • Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Learn more about time-frame analysis here:
  • Stocks appear to be in a corrective phase but could get put to the test; levels and lines to watch in the days ahead. Get your weekly equities forecast from @PaulRobinsonFX here:
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here:
  • Further your forex knowledge and gain insights from our expert analysts on AUD with our free guide, available today:
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here:
  • Trading Forex is not a shortcut to instant wealth, excessive leverage can magnify losses, and sentiment is a powerful indicator. Learn about these principles in depth here:
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here:
  • The Japanese Yen is eyeing the upcoming Bank of Japan rate decision and CPI figures, but JPY crosses will likely remain dependent on broader market sentiment. Get your weekly $JPY forecast from @FxWestwater here:
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here:
S&P 500 Plunges, DAX Enters Bear Market on Trade War Fears

S&P 500 Plunges, DAX Enters Bear Market on Trade War Fears

Peter Hanks, Strategist

Talking Points:

  • After markets were closed on Wednesday, US equities were battered early Thursday
  • Previously touted trade war progress has since been dismissed and fresh fronts have been opened
  • European indices felt the pressure earlier Thursday as the DAX entered into a bear market

A breakdown in US equity markets followed market participant’s reevaluation of the US-China trade war progress touted by President Trump earlier in the week. The S&P 500 and Dow have now suffered losses in the year-to-date while the Nasdaq remains green.

S&P500, Dow, Nasdaq Price Chart Daily, Year-to-Date (Chart 1)

US Indexes price chart trade war drop

Despite the relatively low historical volume for the month of December, the depth of the recent decline is substantial and could buck the trend. Further, the degree of Thursday’s move is reflected in the CBOE’s VIX or ‘fear index’ which jumped 50% from Tuesday to Thursday’s open despite a strong equity performance to start the week.

S&P 500 Plunges, DAX Enters Bear Market on Trade War Fears

Chart prepared by John Kicklighter

On Monday, President Trump heralded strong progress and a 90-day trade war truce between the two nations and the news sent global indices higher. On Tuesday, geopolitical analysts voiced concerns on the lack of immediately tangible results from the talks.

Markets were closed on Wednesday to honor the passing of former President George H.W. Bush which squashed volume and volatility. The low-volume day halted any significant move in the major indices despite concrete developments in the US-China trade war.

After a day on the sidelines, investors were eager to dump their shares Thursday morning after the arrest of China’s Huawei CFO, also the daughter of Huawei’s CEO. The arrest was made in Canada at the behest of the US Justice Department. Many analysts equate the move to a dangerous new front in the US-China trade war and a substantial increase in tension just days after significant progress was cited. For many, the arrest was the concrete development speculators needed to confirm their suspicions on trade war progress and equities felt the consequences.

FTSE, DAX, S&P 500 Price Chart Daily, Year-to-Date (Chart 3)

S&P500, FTSE, DAX price chart trade war december

For those watching global markets, the risk-off tone was seen well before US markets opened. Many European indices faced their worst performance in years. The German DAX plummeted -3.48% to a two-year low and entered bear market territory. Similarly, the FTSE 100 shed -3.15%. For both the indexes, the drop is the worst since Brexit.

S&P 500 Price Chart Daily, Year-to-Date (Chart 4)

S&P 500 price chart december decline

As for the S&P 500, the next few days will be a critical test for the index from a technical perspective. The price trades near trend-line support from February 2016 and a weaker line of support from February of this year. Similarly, the 50-day moving average (DMA) crossed the 200DMA to signal a “death-cross” a technical signal many traders view as a strong bearish development.

Read about the history of major financial crashes and bubbles with “A Brief History of Major Financial Bubbles, Crises, and Flash-crashes.”

If the support lines are broken, it would be reasonable to expect further and deeper declines as the bottom becomes uncertain. On Friday, economic data to reverse the risk-off mood is sparse. With the exception of US unemployment, equity markets may have to wait for next week or a fundamental change in the trade war to regain their footing.

--Written by Peter Hanks, Junior Analyst for

Contact and follow Peter on Twitter @PeterHanksFX

Read more:Oil Prices Drop on Potential OPEC Disappointment, CAD Extends Losses - US Market Open

DailyFX forecasts on a variety of currencies such as the US Dollar or the Euro are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.