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 off TD365.com. 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 21/07/22
US Indexes added to the previous sessions gains as markets were boosted by tech stocks ahead of key earnings next week. The Nasdaq was up 1.5% as Netflix jumped 7.4% as they ‘predicted’ they will return to customer growth after a 1million drop in subscribers…shows that tech dipping buying is still strong. I feel it was part of general ETF buying into tech as investors hope for good results next week. The markets remain a bit of a rollercoaster with traders looking to earnings for further direction on the economy while keeping focused on inflation and interest rates. We may need further earnings (towards end of year and next) results for the full impact of inflation and rates rises. Also, low volumes can exacerbate moves and create choppier markets. The US made back some lost ground and pressured Gold lower while Bond Yields moved down during the US session. BOJ Monetary Report and Outlook, Tentative, EUR Main Refinancing Rate and Policy Statement at 10:15pm AEST, ECB Press Conference at 10:45pm AEST and US Unemployment Claims at 10:30pm AEST.
The ASX200 is expected to open DOWN 25 points as the SPI200 drifted lower in a choppy overnight session.
SPI200 (Sep) overnight futures down 33 pts to 6636
SP500 up 23.21 pts to 3959.90
NASDAQ Composite up 184.50 pts to 11897.65
Dow Jones up 47.79 pts to 31874.84
FTSE100 down 31.97 pts to 7264.31
DAX30 down 26.43 pts to 13281.98
GOLD futures US session (AUG) down $16.40 to $1694.30 an ounce
COPPER futures US session (Comex Sep) up $0.0223 to $3.3133 a pound
OIL futures US Session (Nymex Aug) down $1.96 to $102.26 a barrel
CRB Index up 1.57 pts to 287.04
AUDUSD trading at 0.6887
EURUSD trading at 1.0180
GBPUSD trading at 1.1979
USDJPY trading at 138.2500
USD Index US Session (ICE Sep) up 0.355 to 106.905
The SPI200/ASX200 had a choppy overnight session as price struggles with the highs and resistance. The SPI200 was held down around 6655 but up off support around 6625 so these two levels are key for today. I do not expect a big move lower but will be watching for a flush of 6625 and bounce early. (Refer to the members area for updated ASX200 charts) The DOW generally had a lacklustre US session and held recent gains. Price is caught between two minor RTFs (Re-Test Fail) so will need to break one or the other for some conviction from buyers/sellers. I will be watching for a flush lower and then higher low and move up as prices find earnings support (or overall support from tech buying). The US Tech 100 managed to find some buying off 12225 but also held below 12455. I expect that the Nasdaq and Tech will hold up and be a little choppy into next week when some of the big tech shares are reporting. The Hang Seng flushed into 21030 yesterday and then faded lower in European and US trading. I expect that the underlying index may look to close the gap up from yesterday and the CFD push into 20560 on the open, so watching for longs off the level. The Nikkei moved into 27750 before fading lower off the level. The move down was well controlled and not showing a lot of weakness so may look to hold up off 27450. Watching for a flush and hold of the level on the opening drive as the underlying index has been strong lately and I would expect that strength to continue. The DAX Index has moved lower off previous highs and held a lower high at 13300. Price is holding a minor support area at 13180 but I do not expect buyers to pile into the action ahead of the ECB rate statement late in the European session. UK 100 Index also drifted lower as some recent buyers were squeezed out of the action. I will be watching to see if price action finds some buyers around 7218 and can hold a higher low.
Cryptos were contained although Bitcoin and Ethereum did give up some minor gains during the US session which may show some skepticism with the share market rally if BTC and ETH are acting as risk assets which I feel they are doing. Bitcoin is moving lower off 24060 and found minor support at 22870 while Ethereum is holding below 1615. I expect a further grind lower for both but will be on guard for a spike higher off higher lows.
Spot Gold took another hit to break out of the contraction (shown on the charts) and move down heading for daily support around 1685. I expect that price will spike into the level and we may see some buying support and potential short covering for support also. For now, Gold remains linked to the USD which I suspect has made the highs unless the Fed does not tackle inflation as expected….then there is higher prices to come. Crude Oil was generally tame yesterday and held a minor support level at 98.60. Price also failed to take out the 100.88 highs so watching for a break either way but biased up at this stage for another momentum push higher. USD Index found some buyers to hold the 106.429 level and push price higher into the US close. Price has contracted over 2% off the highs but is holding the recent trend down in tact. I expect that we may see some chop ahead of the ECB rate statement tonight.
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US Tech 100 Index
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