Charts Marked with anticipated entry setups in YELLOW and ideal setup in GREEN on market opens. 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 MONDAY 8/08/22
US Indexes had strange session as bears sent the major indexes lower after payrolls came out a lot stronger than expected before buyers defended the open and ramped prices back up to where they started. The data release was extremely inflationary although you would not feel that the way the DOW made back all the opening losses to close slightly higher. US Bond yields told a different story as they ramped higher across the board and held into the close, along with the USD, on expectations that the Fed may be lagging the curve with rate rises and will need to be a lot more aggressive. I expect that the weakening global economy is not showing up in the data just yet and the markets are very short sighted at this stage and moving intraday rather than for the longer term. The much stronger employment release highlights the need for faster rate rises which will in turn cap growth which may be felt early next year. NZ Inflation Expectations at 1pm AEST.
Market Price Action was very contained in the US session and I would expect more of the same today!
The ASX200 is expected to open DOWN 10 points after a sea-saw US session Friday to end the week.
SPI200 (Sep) overnight futures down 7 pts to 6907
SP500 down 6.75 pts to 4145.19
NASDAQ Composite down 63.03 pts to 12657.55
Dow Jones up 76.65 pts to 32803.47
FTSE100 down 8.32 pts to 7439.74
DAX30 down 88.75 pts to 13573.93
GOLD futures US session (Spot) down $15.16 to $1775.80 an ounce
COPPER futures US session (Comex Sep) up $0.0703 to $3.5518 a pound
OIL futures US Session (Nymex Sep) up $0.47 to $89.01 a barrel
CRB Index down 0.17 pts to 281.04
AUDUSD trading at 0.6911
EURUSD trading at 1.0183
GBPUSD trading at 1.2073
USDJPY trading at 135.0100
USD Index US Session (ICE Sep) up 0.864 to 106.430
The SPI200/ASX200 had a choppy session as buyers held price up after the initial spike lower from the surprisingly strong US Employment release. Price held below resistance at 6916 and I do expect a reaction lower today. In saying that, the support into major Indexes after the employment release was a little strange considering that this may mean that the Fed is well behind the curve with rate rises and controlling inflation and will sooner of later have to aggressively play catchup. (Refer to the Trade The Structure members area for updated ASX200 charts) The DOW flushed lower from 32380 on the payroll release only to ramp back up to the level into the US close. It seems that traders are more focused on the economy than high inflation that may not be kept in check. I expect to see a delayed reaction lower today off 32380. The US Tech 100 came under a little more pressure than the DOW, as would be expected, and held below the EMAs into the US close. I will be watching the 13205 level to see if it holds today which I expect will lead to lower prices. If it does not hold, expect to see a move higher into 13275. The Hang Seng moved lower in the US session holding lower highs below 20125 after a relatively buoyant day session Friday. Support at 19965 held and I expect resistance to be around 20125 today. The underlying Index is expected to open down 130/140 points today and pressure lower off major resistance to drag the CFD down. The Nikkei rallied during the Asian session and held onto the gains into the US close. The index has been strong so watching to see if the strength can continue today and see price hold above 28055.
Cryptos rallied over the weekend to lead to a stronger open for Bitcoin and Ethereum today. Both are drifting lower and I expect to see a gap close play into the start of the European or US sessions.
Spot Gold spiked lower after the US employment data release to trade down into 1764 before bouncing. If the USD continues to move lower then Gold will flush up through 1779 today to clear out some sellers but do expect that further strength into the USD will keep the pressure on Gold. Crude Oil initially flushed into new lows before bouncing back above 88.50 on a stronger than expected US economy. I feel the better number will see support at 88.50 hold today and price grind higher on expectations that demand may not ease as much as expected. USD Index had a big rally after the surprise employment number in the US. Price spiked into 106.815 where it was capped as the share markets held up and remained risk on. Price is extended in the short term so I do expect the USD to ease lower but the expectations for a more aggressive Fed should keep support in tact and the pressure to the upside. USDJPY is still holding the price action I am looking for after a rally into the USD lifted the USDJPY above 134.515. Watching the 135.688 level now to see if sellers can hold the zone. Longer term, price is still breaking down from the highs.
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US Tech 100 Index
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