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 29/08/22
US Indexes nosedived from the open once bears got the green light from Powells speech on interest rates. Share markets went risk off and safe havens got a boost…well most accept Gold. Powell said that the US economy will need ‘tight monetary policy for some time before inflation is under control’. This should not have been a big shock considering in the recent spate of positive economic news that pointed to higher and ‘sticky’ inflation. The USD bounced and looks strong, which is not good for dollar denominated currencies like the Euro, while US Bond yields, especially in the short dated 2yr Yields, headed higher. Oil was relatively buoyant considering the panic into the share market… even though price went down, OPEC comments on production cuts provided support. AUS Retail Sales at 11:30am AEST, UK Bank Holiday and FOMC Member Brainard Speaks at 4:15am.
Asian Market Indexes are going to gap down a lot and be under pressure from the open as retail run for cover expecting the worst. For intraday, any short will be in an extended market while any longs will need to be very patient.
The ASX200 is expected to open DOWN 100 points after Powell spooked investors into the weekend.
SPI200 (Sep) overnight futures down 104 pts to 6922
SP500 down 141.46 pts to 4057.66
NASDAQ Composite down 497.56 pts to 12141.71
Dow Jones down 1008.38 pts to 32283.40
FTSE100 down 52.43 pts to 7427.31
DAX30 down 300.49 pts to 12971.47
GOLD (Spot) down $20.38 to $1738.05 an ounce
COPPER futures US session (Comex Sep) down $0.0035 to $3.6955 a pound
OIL futures US Session (Nymex Oct) up $0.54 to $93.06 a barrel
CRB Index up 2.35 pts to 299.09
AUDUSD trading at 0.6897
EURUSD trading at 0.9966
GBPUSD trading at 1.1744
USDJPY trading at 137.6400
USD Index US Session (ICE Sep) up 0.327 to 108.760
The SPI200/ASX200 had an early flush higher to trap some buyers into the US open, before the carnage set in and price fell. Price broke below the anchor to the move up so I expect that there will be a rough open today as last weeks bulls will be feeling the pressure….either way it will be a tough open for intraday traders. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW spiked up into the US open to test 33510 before dumping lower throughout the session. Price ended right on support around 32222 but today could see more downside as the move down was strong with no let up. Sellers will need to see a lower high hold while buyers will need to be patient. The US Tech 100 was much like the DOW…an early trap of buyers before a dump into support around 12637. Like the DOW, price is extended so new sellers will need to see a lower high build while buyers I expect will have to be very patient. The Hang Seng is still showing some strength after price spiked higher and did not see the severe selloff that other indexes did. Price has been under a lot of pressure and recently broke the down trend so is finding some longer term buyers. Ideally, I would like to see a flush lower prior to a rally off a higher low. The Nikkei came under a lot of pressure with a big move lower off 28655 (seeing an expected index open down over 500pts). Price broke clear through many support levels and has started the new week with a flush into support around 28055. Bears will need to see a flush up and a lower high hold for a short while Bulls will need to see a low start to hold.
Cryptos were pushed lower over the weekend and have gapped down on the open today. Prices are weak and in no mans land for now so will be difficult to trade intraday. Buyers will need to see higher lows start to hold for a squeeze higher while sellers will want to see a flush higher to clear out some shorts before a lower high holds.
Spot Gold is pressing back down into support around 1730 as the USD stays stubbornly high. I expect that we will see more pressure lower into Gold as a minor lower high holds. Watching for a flush into 1730 and potentially lower to trigger stops but as the move down is extended, I see a squeeze up may be on the cards….but this will of course depend on the USD movement today which will need to be down. Crude Oil did move lower but reluctantly as buyers supported a spike down into 91.05. I expect that the possibility of production cuts will continue to provide support to minimise any selloff so I am watching for a higher low to hold for a squeeze up. USD Index has flushed lower and then bounced on the back of Powells speech as traders rebalance for higher interest rates and a stronger USD. On a longer term basis, the dollar strength could easily see a move up through daily highs around 109.260. The USDJPY is holding up thanks to the strength into the USD. I still expect that some safe haven buying into the JPY will outweigh the Dollar rally and squeeze out JPY shorts.
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US Tech 100 Index
Hang Seng Index
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