Charts Marked with anticipated entry setups in YELLOW and ideal setup in GREEN. There will be many possible scenarios shown so it is key to work off major levels and higher lows/lower highs once the price action unfolds. All prices refer to the CFD pricing from the charts below. Opening times (AEST) are 10am SPI/N225, 11:15/30am HSI, 4/5pm DAX and UK100 and 10:30/11:30pm DOW and USTech100.
OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 2/06/22
US markets failed from a strong open and I expect many were caught offside as traders expected a strong session after the recent few sessions bounce. The US failed to follow on from a strong Asian and European session and were again weighed down by economic data showing no easing of inflation. A lot of the selling may have also been to front run the employment data out Friday and lock in some gains. The general theme continues…whether the economy continues to show strength enabling it to absorb the high inflation levels. Many believe that we are heading down anyway…continued high inflation leading to a recession or rate rises to reign in inflation leading to a recession 😔. The USD rallied along with US bond yields which signals concern for inflation…again. China and GBP Bank holiday today. ADP Non-farm Employment Change in the US tonight (may move the market but can be out of line with the key release the following day). US key employment data out Friday so I expect a ranging market over the next few days.
The ASX200 is expected to open DOWN 40/45 points after the SPI200 held lower highs into the US close. Expecting to see some pressure from sellers today as many bulls many have been caught offside expecting the US to continue higher.
SPI200 (Jun) overnight futures down 55 pts to 7181
SP500 down 30.92 pts to 4101.23
NASDAQ Composite down 86.93 pts to 11994.46
Dow Jones down 176.89 pts to 32813.23
FTSE100 down 74.71 pts to 7532.95
DAX30 down 47.88 pts to 14340.47
GOLD futures US session (Aug) up $0.30 to $1848.70 an ounce
COPPER futures US session (Comex Jul) up $0.0295 to $4.3255 a pound
OIL futures US Session (Nymex Jul) up $0.59 to $115.26 a barrel
CRB Index up 3.49 pts to 320.02
AUDUSD trading at 0.7175
EURUSD trading at 1.0653
GBPUSD trading at 1.2487
USDJPY trading at 130.1500
USD Index US Session (ICE Jun) up 0.814 to 102.580
The SPI200/ASX200 is under pressure as price holds lower highs off key levels. Watching for the SPI200 to hold below 7204 and fend off a potential ramp on the open. I feel that many will be caught offside; after yesterdays bullish Asian market session; who were expecting the US to continue higher. Watching for a lower high sell setup. The DOW failed off 33220 as price gave up an opening gap up to find selling pressure throughout the US session. It is a continued battle between economic growth (or a slowing economy) and inflation. Watching for a squeeze higher and then another leg down through 32720…depending on whether the Asian market session is weak or not. The US Tech 100 flushed higher on the US open into 12820, to trap some bulls before moving down into 12540. Watching for more selling pressure to take the market down through 12540 today off a lower high. Hang Seng moved lower from the close of the underlying index into 21025. The RTF (double top) at 21375 is holding the action down so watching for an early flush higher to trap some bulls before a lower high sees a move down. The underlying index is coming off resistance which will add to the pressure. The Nikkei also held an RTF at 27585 which I see capping the action today. The underlying index is also struggling at resistance so we may see some unwind today of long positions as the US failed to follow through with a rally and disappoint bulls. The DAX Index fell away from resistance as expected and pushed down to hold lower highs into the close. The anchor down is at 14500 and I am watching for a lower high to hold at 14428 for a move down into 14215. UK 100 Index also failed off major resistance around 7606 after hovering above the level for the last few sessions. The break below 7579 may see more sellers pile in to pressure the index lower so watching for a lower high into the European open.
Cryptos took a hit at the start of the US session as a rally into the USD and fall into major indexes weighed on bulls. The move down pretty much reversed the sharp rally off the lows. Bitcoin pushed back below the $30K mark which will not be good for bulls as buyers are again under pressure. Watching for an extension down into 28680 as long as price holds below 30370. Ethereum held the longer term trend down and failed lower through 1909. We may see some bargain hunting from die hard crypto traders although I expect that bulls from yesterday will be quick to exit today and pressure prices lower.
Spot Gold had a sudden spike higher coming into the open of the US session and withstood the rally into the USD which may be a sign that bulls are readying for a rally. It seems that the rally was enough to flush out some sellers but could still hold a lower high for a move down. Expecting that safe haven buyers will start to provide some support. Crude Oil fell away from 117.80 after price spiked into the level and ended down into support around 114.68. Expect to see a selloff now as price held a key lower high at 117.80 which will bring in sellers and force some profit taking from buyers. Also, if the market expects the USD and safe havens to rally (Share markets fall) then Oil could take a hit. USD Index again rallied holding a higher low at 101.863. Bulls may be looking to squeeze out more sellers ahead of Fridays US employment data release.
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US Tech 100 Index
Hang Seng Index