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 MONDAY 22/08/22
US Indexes moved lower into the weekend in what looks like more of a controlled move than panic selling. Price action on the three major Indexes are still holding the short term uptrends although the rally into the USD and Bond yields may pressure markets further. It is interesting to see that the Mid to Long term bond yields are rallying which suggests that the bond market expects inflation is far from under control and is stickier at higher levels than the Fed may suggest….and it all potentially points to higher rates rises than expected. Gold remains out of favour with bulls and inflation buyers and is set to pressure back down into lows potentially into 1682. Oil is attempting to hold up off a daily support zone around $86 but still needs to prove itself first…while Ethereum and Bitcoin remain on their knees!! JPY BOJ Core CPI at 3pm AEST, French Flash Manufacturing and Services PMI at 5:15pm AEST, German Flash Manufacturing and Services PMI at 5:30pm AEST, UK Flash Manufacturing and Services PMI at 6:30pm, USD Flash Manufacturing and Services PMI at 11:45pm and US New Home Sales at 12am AEST.
Market Price Action may find some pressure on the open as investors fear a correction in global markets. As mentioned, we are at the stage where markets are extended so buyers will want to take profits.
The ASX200 is expected to open DOWN 35 points after a controlled move down in the SPI200 into the US close.
SPI200 (Sep) overnight futures down 29 pts to 6994
SP500 down 55.26 pts to 4228.48
NASDAQ Composite down 260.13 pts to 12705.21
Dow Jones down 292.30 pts to 33706.74
FTSE100 up 8.52 pts to 7550.37
DAX30 down 152.89 pts to 13544.52
GOLD futures US session (Spot) down $11.33 to $1747.14 an ounce
COPPER futures US session (Comex Sep) up $0.0382 to $3.6697 a pound
OIL futures US Session (Nymex Sep) up $0.27 to $90.27 a barrel
CRB Index up 1.70 pts to 292.03
AUDUSD trading at 0.6875
EURUSD trading at 1.0037
GBPUSD trading at 1.1829
USDJPY trading at 136.9700
USD Index US Session (ICE Sep) up 0.600 to 108.015
The SPI200/ASX200 followed on from the day sessions weak close and was sold off all night holding lower highs. Price did extend down into 6979 where it bounced into the US close. Retail traders will be hitting the sell buttons on the open so I will be watching the 6979 level to see if it is defended for a bounce or price wants to continue lower. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW moved below 33835 and remained below the level holding lower highs into the close. Price has just opened lower for the new week so expecting to see a push down into 33525 potentially off a lower high after a flush higher. The US Tech 100 has also opened weaker today after holding below 13295 Friday. Watching to see if bears can hold below 13207 today or whether we bounce back above the level for the start of a squeeze higher. If we do see price hold below, then a selloff into 13065 is on the cards. The Hang Seng held lower highs as the selling continued. I expect that price will test into the 19515 area and will be watching for a break down below today. We may see the usual flush higher on the open to trap bulls in preparation for a late selloff. If price does hold the 19515 level, then we may expect a longer term squeeze higher but I find it hard to see bulls standing in front of this weak market. The Nikkei was also under pressure all session into the US close. The lower high holding the action down is at 28815 and I expect that we will see a flush into 28640 on the open. A break below this level opens the door to a major selloff so I expect that it will hold today and wait to see what the US does later. The DAX has opened into 13510 and is holding lower highs from last weeks price action. Watching the 13510 level today as price could just as easily bounce as it could go lower. Expecting to see some bargain hunting off the level for a minor rally. The UK100 continues to look stronger than the other key Indexes as price holds higher lows. Sellers did defend the 7564 level after an early flush to trap some buyers. Longer term, price remains in an uptrend so I will need to see a break below 7500 for a potential change in direction lower.
Cryptos took a big hit on Friday as Bitcoin and Ethereum were driven lower more than expected (refer to Fridays Trading Plan report for the price action setups). ETH has opened a lot weaker after the weekends trading while BTC is holding around Fridays lows. Watching for Bitcoin to press into 20885 but we may expect a squeeze higher first. Watching the 1583 zone on Ethereum for some action…potentially a higher low and squeeze up to clear out some sellers.
Spot Gold is well and truly in a short term downtrend potentially looking to the 1715 area. Price continues to hold lower highs so the action remains biased down. The anchor to the move lower is holding at 1757 so this will need to break before we can start to look for a move up. Crude Oil had a choppy session with price flushing above 91.05 before being dumped into the US close. The recent trend is up but is on shaky ground so expecting continued volatility and choppy price action. The daily trend is extended lower so could bring in some bargain hunters to hold price up off the $86 area if traders expect demand to remain strong. USD Index continues to find strength and is heading up into daily highs. Looking for an extension to the move up into 108.740 before a potential bought of profit taking. With bond yields pressuring higher, the Dollar will continue to be supported. USDJPY is still not playing ball and continues to move up with the USD strength and has pushed into 137.312. Want to see this level hold but expect that it will depend on the USD. 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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