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.
PROCESS IS KEY….DEFINE LEVELS – MARK EXPECTED PRICE ACTION – TRADE THE SETUPS
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 MONDAY 11/07/22
US Indexes had a contained session being capped twice into highs as traders weighed up the Employment data and what it may mean to the economy and interest rates. The jobs number came in stronger than expected but lower than previous while Average Hourly Earnings were in line with expectations…which set the scene for a boring session. The focus going forward will be on the economic data and earnings/guidance to see how companies are expecting to deal with the coming rate rise cycle and what that means for growth…US CPI out Wednesday. Bonds yields jumped after the employment number as bond prices went lower and the USD moved down off recent highs…I expect that traders are just re-adjusting their inflation and rate rise expectations across the board while holding in a short term range. The weakness in the USD helped support Oil, Copper and Gold along with the major FX pairs. BOE Gov Bailey Speaks 12:15am AEST.
Expect that the US will start to focus on the coming earnings reports with a big focus on forward guidance as profit margins take a hit from higher inflation.
The ASX200 is expected to open UP 20 points as the SPI200 saw a choppy overnight session Friday lacking any clear direction.
SPI200 (Sep) overnight futures up 20 pts to 6597
SP500 down 3.24 pts to 3899.38
NASDAQ Composite up 13.96 pts to 11635.31
Dow Jones down 46.40 pts to 31338.15
FTSE100 up 7.16 pts to 7196.24
DAX30 up 172.01 pts to 13015.23
GOLD futures US session (Aug) up $2.60 to $1742.30 an ounce
COPPER futures US session (Comex Sep) down $0.0537 to $3.5183 a pound
OIL futures US Session (Nymex Aug) up $2.06 to $104.79 a barrel
CRB Index up 2.67 pts to 287.75
AUDUSD trading at 0.6861
EURUSD trading at 1.0185
GBPUSD trading at 1.2033
USDJPY trading at 136.1000
USD Index US Session (ICE Sep) down 0.269 to 106.690
The SPI200/ASX200 was range bound Friday and the price action was uncertain and choppy as the SPI200 lacked a clear lead from the US. Price held up off 6560 while the buyers were capped at 6614. Watching the 6850 level to see if it holds for another push into highs today or whether price breaks lower to squeeze out some buyers. I expect to see bearish action as 6614 is a solid resistance level and has held for a few sessions now. (Refer to the members area for updated ASX200 charts). The DOW had a very choppy session to end the week as price was supported into 31223 but also capped around 31500. The bias is up but the price action does not show commitment from buyers so we may expect a flush lower before any further upside. The US Tech 100 was a lot like the DOW as price failed to break either way. The momentum is up with resistance at 12115 and then up around 12230. I expect that we may see a run up into 12230 into the US open and before any pullback but this will depend on the European session. The Hang Seng was also well contained in the overnight session between 21570 and 21815. I expect that bulls will look to hold 21570 on the open for a run up through 21815 while sellers will look to hold an opening spike into 21815 and run price lower. The opening will be important to get a gauge for the session. The Nikkei held higher lows into the US close suggesting that it may want to go higher although price struggled to take out the day sessions highs Friday night. I will be watching the 26704 level to see if price fails and moves lower as I expect there may be some bearish action into the underlying index. The DAX Index initially moved up off a higher low and took out the 12940 level but could not add to the gains into the US close. With momentum up stalling, the open of the European session will be telling as to whether price continues to hold higher lows or whether we can expect a squeeze on recent buyers. UK 100 Index was a bit of a mess lacking any directional move at all making for a very difficult session for daytraders. Price was capped into 7205 but did reject any move down into 7110 so I will be watching to see if a higher low can hold for a break up and through 7205.
Cryptos bulls have again been disappointed as Bitcoin and Ethereum have opened weaker today and failed off highs and resistance zones. Watching to see if ETH can push into 1169 and Bitcoin into 20650 to see how buyers will react. For now, longer term looks to be happy to continue to hold within the wide range it has been in for weeks now.
Spot Gold failed to kick higher through 1748 as sellers once again held the action down. Bulls will be looking to the USD for a bigger move lower through support to give Gold a kick higher. For now, it remains in the range between 1733 and 1748 and will need to make a clear break and retest before I will be happy to look for an entry. Crude Oil found some support from the weakness into the USD after the data release. Price held up off 102.37 but has opened weaker and is holding below 105.55. Expecting to see a squeeze lower and buyers take some risk off the table as the momentum up stalls. USD Index edged lower after the employment data release but held above support around 106.760. Expecting that traders may be awaiting the CPI number later in the week for a move either way so expecting to see some range bound action for now between 106.760 and 107.250. Longer term, I do not see a big move lower until it is clearer what the Fed has install for interest rate rises. On the flip side, a push into new highs may fail quick as higher rates are factored into the action.
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US Tech 100 Index
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