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 FRIDAY 19/08/22
US Indexes were again supported on dips as bulls try to fend off a bought of profit taking and a push lower. Short term US bond yields eased while the widely watched 10-year bond yield held on to the lows suggested that the bond market may be expecting more rates rises than the share market and for longer. The USD also found further strength in support of the bond market to pressure USD denominated assets lower…such as gold and the major currency pairs. The share market remains bid for now but the Nasdaq may look to squeeze out some bulls in the near term on higher interest rate prospects. It seems that the market is still trying to figure out the Fed minutes and what can be expected with interest rate rises. The minutes suggest they will be less aggressive if inflation recedes…problem is the economic data remains strong which translates to lingering high inflation…so the Fed really did not say much at all. For now it seems that the Bond market and Stock market have different views…and I expect that the bond market is usually right. GBP Retail Sales at 4pm AEST, German PPI at 4pm AEST, EUR Current Account at 6pm AEST and CAD Retail Sales at 10:30pm AEST.
Market Price Action continues to be supported especially the US and the Nikkei but we may have seen the first bearish cracks appear. We are at the stage where markets are getting extended so buyers may take profits and intraday action will get more volatile.
The ASX200 is expected to open UP 20/25 points after a well supported overnight SPI200 session push price into resistance.
SPI200 (Sep) overnight futures up 23 pts to 7043
SP500 up 9.70 pts to 4283.74
NASDAQ Composite up 27.22 pts to 12965.34
Dow Jones up 18.72 pts to 33999.04
FTSE100 up 26.10 pts to 7541.85
DAX30 up 70.70 pts to 13697.41
GOLD futures US session (Spot) down $3.68 to $1758.47 an ounce
COPPER futures US session (Comex Sep) up $0.0023 to $3.6495 a pound
OIL futures US Session (Nymex Sep) down $2.39 to $90.50 a barrel
CRB Index up 1.46 pts to 290.33
AUDUSD trading at 0.6915
EURUSD trading at 1.0089
GBPUSD trading at 1.1931
USDJPY trading at 135.8800
USD Index US Session (ICE Sep) up 0.934 to 107.420
The SPI200/ASX200 continued with the recent routine of flushing during the day session and doing the bulk of the heavy lifting in the overnight session. Price rallied up into resistance around 7044 which will be key for the open. Watching to see if price flushes lower to clear out some overnight buyers or whether price just ramps up from the open…for now, the 5min trend is up and being held at 7026. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW is holding a range between 34040 and 33862. The EMAs have basically flatlined which is showing some indecision from both bulls and bears. I expect a bigger squeeze lower prior to a new leg higher so watching for a lower high to hold. The US Tech 100 was choppy and was weighed down on any push up into 13568. I am watching for a bigger flush lower to hold a major lower high as higher interest rates weigh on bulls. The Hang Seng held lower highs as the underlying index continues to be weighed down by bearish sentiment. In saying that, price held a minor RTF at 19635 which could trigger a bullish flurry on the open. If price breaks below 19635, then watching for a push down to 16517 to clear the lows. The Nikkei held higher lows to continue with the recent strength. The Nikkei has been very strong of late but the underlying index is showing some cracks as there was a distinct change in bullish sentiment yesterday. The index is looking set to open up 150 pts but I will be watching for a lower high to hold. The DAX held around the lows from the previous session as bargain hunters provided some intraday support. Price could not get a strong enough bid and looks ready for another flush lower. Watching for a lower high to hold and for a continuation move down off the EMAs. The UK100 was a lot stronger than the DAX and pushed up into resistance and previous highs around 7564. Price is stretched into the level so I will be watching for some profit taking from buyers and a move lower off a lower high.
Cryptos were well contained but did come under pressure from sellers. Both Bitcoin and Ethereum are hovering around minor levels and not showing a lot of indication of a direction. Still, I will be watching for increased selling pressure as BTC holds below 23450 and ETH looks set to push down below 1862.
Spot Gold continued to edge lower as expected being pressured by the rally into the USD. I expect price to flush down into 1754 and will be watching for the potential for a bounce up off the level as sellers lock in some gains. This will depend on the next move into the USD. Crude Oil squeezed out some sellers off 87.00 lows and rallied up into 91.20. I will be interested to see whether sellers step back in to pressure price lower as I do not thing the bears have finished yet. Price is extended into the level so I would expect a flush lower to put some buyers back on the sidelines. USD Index spiked up through resistance from the start of the US session as Fed officials highlighted the need for more rate rises and their focus on getting inflation down. Price extended up into 107.582 resistance and I expect that we may see a grind lower today with price being stretched into the level. USDJPY is still not playing ball and continues to move up with the USD strength. Still watching for a run lower but being a longer timeframe, the setup could still be some time away…continuing to watch patiently for now.
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US Tech 100 Index
Hang Seng Index
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