Morning Jumpstart Macro View 23/11/21

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  • SPI200 (Dec) overnight futures down 12 pts to 7341
  • SP500 down 15.02 pts to 4682.94
  • NASDAQ Composite down 202.68 pts to 15854.76
  • Dow Jones up 17.27 pts to 35619.25
  • FTSE100 up 31.89 pts to 7255.46
  • DAX30 down 44.28 pts to 16115.69
  • GOLD futures US session (Dec) down $46.10 to $1805.50 an ounce
  • COPPER futures US session (Comex Dec) down $0.0195 to $4.3880 a pound
  • OIL futures US Session (Nymex Dec) up $0.43 to $76.37 a barrel
  • CRB Index up 0.24 pts to 235.26
  • AUDUSD trading at 0.7224
  • EURUSD trading at 1.1235
  • GBPUSD trading at 1.3388
  • USDJPY trading at 114.8800
  • USD Index US Session (ICE Dec) up 0.500 to 96.528

US indexes took a hit into the close to give up early gains as a fall in the Nasdaq weighed on the broader market. Traders were focused on Biden’s nomination for Powell and a second four year term as the US Federal Reserve Chairman. Many saw the move as a positive and giving the markets and the economy increased assurance and certainty on the comeback trail from the Pandemic. Bond yields jumped pushing bond prices straight down into recent lows and later weighed on the share market into the close. The rally in yields triggered early buying into banking shares as many are settling with the idea of higher interest rates soon. Energy also gained to support the broader market while Tech came under pressure after Biden’s announcement, and the rally in bond yields, as they were expecting a ‘lower for longer’ friendly nomination (for interest rates). The DOW closed up 0.05% while the broader SP500 ended down 0.32% and the Nasdaq closed down 1.26% for the session. In Europe, major Indexes were mixed with the DAX moving lower off highs while the FTSE moved up in a choppy session. The FTSE was supported by a lift in miners and bank stocks while traders will continue to mull over a potential Bank Of England interest rate rise. The DAX continued to be weighed down by fresh covid lockdowns in the absence of any positive news. German Chancellor Merkel told her party that hospitals would soon be overwhelmed unless the fourth wave of the pandemic is broken.

The USD Index continued its merry way higher adding to recent gains for the currency and pressuring other major pairs. With the news of Powells re-nomination, the dollar is expected to continue higher as bulls remain in control and target a move above 97.000 to continue to pressure the Feds interest rate narrative. The EURUSD continued to see long positions unwind and sellers jump into the action as the USD rallied. Price action is in a clear downtrend and targeting new lows as recent news of European lockdowns continue to weigh on the possibility on rate rises from the ECB. Expecting that the next stop for the Euro is down into 1.1175 and then down below the 1.1000 zone. The GBPUSD also came under pressure although rate rise expectations are buoying price for now. Price moved lower as expected and took out the 1.3410 level to extend lower into the US close. Watching for bears to add to the move down today and further pressure buyers out of the action. The AUDUSD was helped higher early by the risk on sentiment into the share market although the rally in the USD weighed on the Aussie in the US session. Price initially pushed up off 0.7227 minor support before breaking the level into the US close. Expecting to see buyers targeted with a squeeze lower today and some continuation of the move down. The USDJPY rallied hard after the Powell nomination news. Price was supported by the rally into the USD and some unwinding of safe haven JPY long positions. Price extended into the 114.935 area where we may see some sellers test the waters and cap the bullish move today.

SPOT GOLD was hit hard and was all one wat action lower in both the European and US sessions. The 1830 zone provided no support as sellers pierced straight through the area and back into 1800. Price reacted to the stronger USD and again dashed the hopes on interest rate bulls. Price is extended so expecting to see some profit taking from sellers and gains locked away today to take some heat out of the selloff. Crude Oil managed to find some buying support and edge higher after OPEC+ said it would reconsider plans at its meeting next week to increase production cuts if countries tap their strategic energy reserves. This is in response to the US and other countries considering releasing oil from strategic reserves. Price was supported around 75.15 and may look to squeeze out some sellers today. Copper managed to push back against the USD rally and added to recent gains. Price was capped by sellers into 4.4185 which may trigger some profit taking from buyers in coming sessions and a move lower.

Cryptocurrencies area really starting to unwind as sellers pile into the action. Both Ethereum and Bitcoin are showing signs of wanting to go lower and there remains a lot of buying fuel that could still come into the action to pressure price. Bitcoin is currently trading at $55942.50 down 6.26% while Ethereum is trading at $4043.21 down 7.30% and Ripple is at $1.0326 down 4.07%.

The ASX200 started the new week on the back foot yesterday as sellers pushed the index lower to end down 43.4 points to 7353.1. Shares in Gold, IT and Energy dragged the index lower while Financials also came under pressure. Falling stocks outnumbered advancing ones by 906 to 528 and 392 ended unchanged. The Hang Seng ended the day down 0.39% while the Nikkei was up 0.09%.

The ASX200 is expected to open down 10 points and extend on the losses as the US took a hit into the close dragging the SPI200 down with it.


JPY Bank Holiday

AUD Flash Manufacturing and Services PMI 9am

EUR German Flash Manufacturing and Services PMI 7:30pm

EUR Flash Manufacturing and Services PMI 8pm

GBP Flash Manufacturing and Services PMI 8:30pm

GBP MPC Member Haskel Speaks 10pm

USD Flash Manufacturing and Services PMI 1:45am


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