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 SPI/N225 at 10am, HSI at 11:15/30am, DAX and UK100 at 4/5pm and DOW and USTech100 at 10:30/11:30pm .
OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 17/08/22
US Indexes rallied to add to recent gains on the back of some upbeat earnings results from Walmart and Home Depot. The results were taken as a positive that Consumers are remaining strong under the weight of higher inflation. Still, I feel that the bounce higher off major lows is starting to run out of steam so we will need a pullback at least to continue the upwards momentum. US bond yields are telling a different story with yields edging higher to pressure tech shares and still showing concern for high inflation and rate rises. This makes sense when we think about Consumers happy to continue to spend while inflation is highs…I would therefore expect prices to remain high and inflation elevated which means the Fed has to be more aggressive and leaving a soft landing still in question. Still, the bounce higher across the board in major indexes has been bigger than many expected showing signs that bears are waning. AUS Wage Price Index at 11:30am AEST, NZ Official Cash Rate and RBNZ Rate Statement at 12pm AEST, GBP CPI at 4pm AEST, US Retail Sales Data at 10:30pm AEST and US FOMC Meeting Minutes at 4am AEST.
Market Price Action continues to be supported especially the Nikkei as it continues to press higher. We are at the stage where markets are getting extended and I feel buyers may take profits so intraday action will get more volatile.
The ASX200 is expected to open UP 10 points after a relatively choppy and directionless overnight session.
SPI200 (Sep) overnight futures up 12 pts to 7020
SP500 up 8.06 pts to 4305.20
NASDAQ Composite down 25.50 pts to 13102.55
Dow Jones up 239.57 pts to 34152.01
FTSE100 up 26.91 pts to 7536.06
DAX30 up 93.51 pts to 13910.12
GOLD futures US session (Spot) down $4.09 to $1775.46 an ounce
COPPER futures US session (Comex Sep) up $0.0075 to $3.6250 a pound
OIL futures US Session (Nymex Sep) down $2.88 to $86.53 a barrel
CRB Index down 1.87 pts to 287.67
AUDUSD trading at 0.7025
EURUSD trading at 1.0168
GBPUSD trading at 1.2093
USDJPY trading at 134.2400
USD Index US Session (ICE Sep) down 0.043 to 106.390
The SPI200/ASX200 tried to push higher again in overnight trade but ran into some selling below the day sessions highs. Still, price action is in a prime are to again extend higher and add to the gains so wary of a push above 7034. Ideally, I would like to see a lower high hold and squeeze on buyers for a move down. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW hit the 34155 target and flushed up through the level to trigger some stop losses. Watching now to see if there will be a reaction down off the level or whether bulls remain strong and continue the push higher. Lots of data out tonight especially Retail Sales that could show more of the Consumers sentiment. The US Tech 100 Had more of a choppy session compared to the DOW as price struggled to hold above 13573. I would expect that bulls want to press price up into 13767 so may have another attempt tonight. If not, then there is the potential for a good squeeze lower. The Hang Seng had a big flush lower in the European session (prior to the underlying index close) and then managed to reclaim a lot of those losses later in the US session. A lot of the good intraday action has been later after a choppy day so expect more of the same on the open but looking for another extension lower as I feel that the sentiment is very negative. The Nikkei is still very strong as the price action held up well at the start of the European session when other indexes were get sold lower. Expecting that the Nikkei will continue to be supported but price on the underlying is getting extended so could find more selling pressure soon. The DAX held a higher low at 13823 in a relatively uncertain market. Price ended the session on highs around 13955 so watching the level for either a sell and squeeze lower or for a higher low to hold above 13823 and buy entry setup. The UK100 added to gains although data showed the labour market cooling while earnings crept up which adds to inflation pressure as company costs are passed on to the consumer. Still, expecting to see the upward momentum continue and bulls make a push up into 7642 in coming sessions as long as the anchor to the move up at 7464 holds.
Cryptos came under more pressure as the USD pushing into highs. Still, bulls seemed resilient as share markets edged higher. Ethereum is hovering above support at 1862 bit holding minor lower highs suggesting more downside to come. Bitcoin has moved below support at 23915 but not in a convincing manner from sellers. Watching both BTC and ETH for a grind lower but on guard for a squeeze higher off a higher low…good to have all bases covered.
Spot Gold moved lower on the back of a stronger USD. Price is holding above 1764 and has a minor support area that I will be watching today at 1773. If this level holds, then watching for a higher low and squeeze up. Crude Oil pushed down through lows at 87.00 as the pressure down continues. Watching for a squeeze higher but want to see price push back above 87.00 and then a higher low hold. If not, then expecting lower prices. USD Index rallied at the start of the European session into 106.810 to flush the level and then fall straight back down again to where it started. Watching to see if price can hold above 106.415 or whether we can expect a squeeze on buyers and move down. USDJPY moved up so the longer term short is off the table for now. Need to see 134.515 hold and price to hold lower highs. Expecting that a bigger move down will come when the USD moves down and USDJPY breaks back below 132.580.
Join Our TRADERS HUB DISCORD CHANNEL for updates and trade ideas (email firstname.lastname@example.org for the link)
US Tech 100 Index
Hang Seng Index
Disclaimer: the contents of this post are presented for informational purposes only. They should not be viewed as investment advice, nor a solicitation to buy or sell any financial securities. Investments in financial products are subject to market risk. Some financial products, such as currency exchange, futures, contracts for difference, options and warrants are highly speculative and any investment should only be done with risk capital. Prices rise and fall and past performance is no assurance of future performance. Trading currency exchange, futures, contracts for difference, stocks, shares, options and warrants on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in currency exchange, futures, contracts for difference, options, stocks, shares and warrants you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with currency exchange, futures, contracts for difference, options, stocks, shares and warrants trading, and seek advice from an independent financial advisor if you have any doubts.