Morning Jumpstart Macro View 27/10/21

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  • SPI200 (Dec) overnight futures up 4 pts to 7422
  • SP500 up 8.31 pts to 4574.79
  • NASDAQ Composite up 9.00 pts to 15235.71
  • Dow Jones up 15.73 pts to 35756.88
  • FTSE100 up 54.80 pts to 7277.62
  • DAX30 up 157.83 pts to 15757.06
  • GOLD futures US session (Dec) down $11.20 to $1795.60 an ounce
  • COPPER futures US session (Comex Dec) down $0.0375 to $4.4905 a pound
  • OIL futures US Session (Nymex Dec) up $0.90 to $84.66 a barrel
  • CRB Index up 0.60 pts to 241.18
  • AUDUSD trading at 0.7504
  • EURUSD trading at 1.1599
  • GBPUSD trading at 1.3765
  • USDJPY trading at 114.1500
  • USD Index US Session (ICE Dec) up 0.118 to 93.927

US indexes were again supported by earnings optimism as gains in tech helped support the broader market SP500 into new all time highs. Tesla shares continue to inflate as price rallied early but did give up the gains into the close after a deal worth $4billion added over $100B to the market cap of the company to trade roughly 172 times 2021 estimated earnings…is this tulip mania??!! Microsoft beats earnings and reported 22% growth while Google also beat analysts expectations although fell after the news. Traders will be expecting similar from other tech heavyweights so it will be interesting to see how bulls react later in the week…will there be some buy the rumour, sell the fact…as with Facebook overnight?! US Economic data showed that consumer confidence unexpectedly rebounded in October as inflation concerns were offset by an improving labour market. Bond prices were well contained into previous highs as yields held recent losses. The DOW closed up 0.04% while the broader SP500 ended up 0.18% and the Nasdaq closed up 0.06% for the session. In Europe, major Indexes were supported by positive earnings as the DAX and FTSE kicked higher. Investors continue to brush aside soaring energy prices, higher yields and the threat of rate rises to focus solely on rising share prices. Focus will be on the ECB Thursday and expectations that the Central Bank will stick to the ‘transitory inflation’ line and remain on hold keeping the stock rally ticking along.

The USD Index continued to be pressured higher as expected after price broke up and through the 93.780 level the previous session. Dollar bulls and starting to take control again on expectations that inflation is here to stay and rate rises are around the corner as US earnings continue to beat expectations. Would expect to see the USD grind higher from current levels although the action may be contained ahead of a bunch of coming central bank meetings. The EURUSD continued to come under pressure as the USD rallied. Price held below the 1.1620 level to continue to put the squeeze on buyers and move lower. Many expect that economic growth and higher inflation in the US and will only support the dollar further over the Euro hence the lack of support for the Euro. The GBPUSD went straight up from the European open…and then straight down again into the US close to end right back where it started. The move up may just be a big flush on recent sellers but this would be confirmed with a push down below 1.3740. The AUDUSD continues to hover around the 0.7505 zone but is lacking the conviction from buyers after the recent move lower off 0.7550. If price starts to move below 0.7485, expecting to see a good squeeze on recent buyers and a run lower. The USDJPY flushed up through the 113.900 area as expected and kicked on hard to clear out a lot of recent sellers. If price can hold above 114.00 then expecting the move up to continue into 114.500.

SPOT GOLD again disappointed bulls as price failed again off the 1807 resistance zone. The rally into the USD was just too much for the bulls overnight unlike the previous session where buyers managed to brush aside dollar strength. Buyers will need to hold price above 1783 to give themselves a chance of a move up from current levels into 1830. Crude Oil managed to fight back from the previous US sessions selloff into the close. Price moved back above the 84.00 level and held onto the gains ahead of inventory data which is expected to show a rise of 2.0M barrels. Copper was weaker as the continuing USD strength weighs on bulls and keeps new buyers out of the action. Price held lower highs but lacked the strength of selling that we would expect if bears were in control. News of low Chinese inventory levels may continue to provide support.

Cryptocurrencies were mixed with Bitcoin edging lower while Ethereum and Ripple finding some buyers into the US close. Bitcoin is currently trading at $62263.60 down 0.65% while Ethereum is trading at $4288.48 up 2.52% and Ripple is at $1.12423 up 3.01%.

The ASX200 had a disappointing day for bulls yesterday as price initially rallied but gave back all the gains into the close as the index ended up only 2.4 points to 7443.4 down 28 points from intraday highs. Gains in IT, Consumer Discretionary and Healthcare helped offset losses in Utilities and Gold. Falling stocks outnumbered advancing ones by 703 to 703 and 416 ended unchanged.

The ASX200 is expected to open flat as the SPI200 gave up early gains in the overnight session to end back where it started.


AUD CPI Data 11:30am

EUR German Import Prices 5pm

USD Durable Goods Orders and Prelim Wholesale Inventories 11:30pm

GBP Annual Budget Release Tentative

CAD BOC Rate Statement 1am

USD Crude Oil Inventories 1:30am


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