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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 THURSDAY 1/09/22
US Indexes came under pressure from the open to end the month on a negative note. The weakness followed on from a negative European session while Asian markets were generally stronger potentially due to ‘window dressing’ for end of month. I expect that the ASX will see some weakness today and hold a negative open. The general global macro outlook remains the same with the focus on a more aggressive rate rise plan from the Fed and also potentially from the ECB after both have to battle stubbornly high inflation. The USD held around highs as expected while bond yields have spiked hard…which will not bode well for inflation bears and translates to further weakness into share markets. Focus now is on the upcoming US Jobs report Friday which will bring in more volatility. Oil prices headed lower to reflect the expected higher interest rate environment and lower demand. CNY Caixin Manufacturing PMI at 11:45am AEST, German Retail Sales at 4pm AEST, CHF CPI Data at 4:30pm AEST, US Unemployment Claims at 10:30pm AEST and US ISM Manufacturing PMI at 12am.
CLICK HERE FOR ECONOMIC DATA OUT TODAY (AEST) 1/09/22
Asian markets set to open weaker although there may be more support into the Hang Seng than the ASX and Nikkei.
The ASX200 is expected to open DOWN 55/60 points after the SPI200 took a hit lower to give back the day sessions end of month window dressing rally.
SPI200 (Sep) overnight futures down 69 pts to 6839
SP500 down 31.16 pts to 3955.00
NASDAQ Composite down 66.94 pts to 11816.20
Dow Jones down 280.44 pts to 31510.43
FTSE100 down 77.48 pts to 7284.15
DAX30 down 126.18 pts to 12834.96
GOLD (Spot) down $13.14 to $1711.20 an ounce
COPPER futures US session (Comex Dec) down $0.0003 to $3.5115 a pound
OIL futures US Session (Nymex Oct) down $2.09 to $89.55 a barrel
CRB Index down 3.17 pts to 290.41
AUDUSD trading at 0.6843
EURUSD trading at 1.0052
GBPUSD trading at 1.1620
USDJPY trading at 139.0400
USD Index US Session (ICE Sep) down 0.134 to 108.615
The SPI200/ASX200 had a big day yesterday with a strong rally from the open on end of month window dressing. The night session saw sellers reverse the gains so the ASX index will open lower today. Watching to see if price holds below 6848 or whether we see an early squeeze on overnight sellers and move up. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW is biased down as price pushed below 31665 support and has tested the extension level at 31520. For now watching to see if price continues to hold lower highs but expect at least a flush higher to clear some sellers out before another leg lower. The US Tech 100 broke below support at 12250 after the US close so we may see a push lower into the European open. Like the DOW, watching for a lower high to hold but do expect that the move down in the short term is a little extended and may need a flush higher to clear sellers before a lower high holds. The Hang Seng had a big day yesterday as the underlying index held support and broke up and out of the daily downtrend. I expect to see more bullish action longer term but watching for an opening flush lower prior to a bid holding and higher low building. The Nikkei moved lower into the US close and has added to the losses in after market trading. Price has pushed into support at 27770 and I expect more weakness into the open. Watching for either a big flush lower to trap sellers and then a ramp higher or a lower high below 27770 for a move into 27520.
Cryptos held below resistance levels with Bitcoin starting to hold lower highs off 20540 and Ethereum holding lower highs off 1583. I see potential for both to work lower today especially if Asian markets come under pressure. Also do not anticipate any support from the USD as I expect the Dollar will be ranging ahead of US employment data.
Spot Gold continues to be out of favour with bulls as price heads lower. The continued strength into the USD is seeing Gold break support levels and I expect the theme to continue. For now, price is being held down at 1721 and I expect any spike to be sold into until the USD starts to move lower….if it does at all. Crude Oil inventories came out weaker than expected and pressured oil down into the US close. The weakness in oil price highlights expectations for higher interest rates and reducing demand. As long at 91.05 holds, I expect that Oil will work lower into 86.40 support in the near term. USD Index continues to hold highs and has put in a higher low at 108.463. Traders and now factoring in higher interest rates and factoring out rate cuts next year that many analysts have been projecting. The fed needs to be more aggressive to stem inflation and at the moment they are behind the curve and need to catch up…which is being reflected in a high USD and high bond yields. The USDJPY is still working up into 139.410 and is putting the squeeze on the BOJ who would much prefer to see a weaker USDJPY. I feel that expectations for intervention from the BOJ should keep a lid on the rally and at some stage see a squeeze on YEN shorts…but for now it remains a waiting game.
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SPI200 Index
ASX200 Index
DOW Index
US Tech 100 Index
Hang Seng Index
Nikkei Index
Spot Gold
Crude Oil
USD Index
Bitcoin
Ethereum
USDJPY
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