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 7/09/22
US Indexes came under pressure from the open as inflation concerns remain a weight on the markets. The USD continued to power higher along with US Bond Yields which reaffirm expectations for resiliently higher inflation. Powell is slotted to speak Thursday which may shed more light on how aggressive the Fed wants to be on interest rates and whether they are serious about bringing down inflation. I feel that the problem is now if the Fed ‘Does Not’ get more aggressive, we can expect higher interest rates down the track and for a longer period of time which is reflected longer dated Bonds moving into new lows (ie higher yields) as recent economic data continues to beat estimates showing that inflation is not going to dissipate. The ECB (European Central Bank) is set to release lift interest rates Thursday when they meet next and are widely expected to also take a more aggressive stance…as Europe still battles with an energy crisis that they can not get under control. AUS GDP at 11:30am AEST, China Trade Balance Tentative, UK Monetary Policy Report Hearings at 7pm AEST, CAD BOC Rate Statement and Overnight Rate 12am, US FOMC Mester Speaks at 12am AEST and US FOMC Brainard Speaks at 2:35am AEST.
Asian markets are all showing weakness and holding a lower high into support areas so the session could easily get moving to the downside…need to see how Nikkei, ASX200 and HSI open to see if buyers are around.
The ASX200 is expected to open DOWN 25 points as the SPI200 gave up early gains after failing again at resistance and moving lower into the US close.
SPI200 (Sep) overnight futures down 37 pts to 6780
SP500 down 16.07 pts to 3908.19
NASDAQ Composite down 85.95 pts to 11544.91
Dow Jones down 173.14 pts to 31145.30
FTSE100 up 13.01 pts to 7300.44
DAX30 up 110.66 pts to 12871.44
GOLD (Spot) down $8.29 to $1701.86 an ounce
COPPER futures US session (Comex Dec) up $0.0460 to $3.4595 a pound
OIL futures US Session (Nymex Oct) up $0.01 to $86.88
CRB Index down 1.85 pts to 282.62
AUDUSD trading at 0.6737
EURUSD trading at 0.9905
GBPUSD trading at 1.1519
USDJPY trading at 142.7800
USD Index US Session (ICE Sep) up 0.690 to 110.200
The SPI200/ASX200 had a good squeeze early from the start of the overnight session to clear out sellers before again failing at resistance around 6848. Price held lower highs into the close so I expect some weakness on the open. The 6769 level is key today as to whether we see a good breakdown (which is what the ASX200 30min chart suggests) or whether support can hold….open will be key. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW was under pressure from the open and broke below 31237 support which it held below into the close. Price looks set to move down through 31055 and hold another lower high but this could also be a trap of shorts for a squeeze higher…I am backing the trend lower for now. The US Tech 100 was much the same price action as the DOW as price held a lower high into the US close. Sellers will be looking to break down below 11962 while buyers will want to defend the level. If Asian markets move lower and Nasdaq does not, to me that means support and a potential rally tonight. The Hang Seng moved lower in overnight trading as bears kept the pressure on. Price held a lower high around 19050 into the close so watching for this to continue to hold the action down today. The move lower will drag down the underlying index on the open which may trigger sellers again into the action to continue the trend down. The Nikkei also held lower highs into the US close but did hold up off 27520 support. The Underlying index is hovering above 27520 which may hold today although I expect to see some pressure on the open to flush below 27520 and into 27415 on the CFD.
Cryptos took a hit, especially Bitcoin, during US trade and are not looking too healthy with regards to price action. The break below 19570 on Bitcoin makes the Daily chart bias down for me and looking to extend on those losses as I expect more bulls will throw in the towel on longs. Ethereum is also looking sick and I expect sellers to pressure price lower again today or into the European and US sessions.
Spot Gold initially flushed higher through 1721 to trap bulls before the continuation move down. Price wants to retest into 1685 and this looks to be a give in when looking at the continued strength into the USD. Would ideally like to see a retest of 1709 from below but we may see sellers take price directly lower from here. Crude Oil flushed into 86.40 major support as the OPEC production cuts were minor and amounted to very little. Bears are in control and will want to test buyers below 86 or at least take out the stops below the level so watching for the flush. USD Index pressed up into new highs above 110.290 before moving back below the level into the US close. The price action remains strong and biased up until the US Fed step up and take care of inflation.
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US Tech 100 Index
Hang Seng Index
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