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 TUESDAY 20/09/22
US Indexes were again supported by buyers from the open ahead of FOMC tomorrow. It seems that the early move lower in European trade was a trap for sellers before the US session ramp. We may have seen some shorts closing positions and bargain hunters edging into the action on expectations of a more aggressive Fed Reserve to take inflation. The overnight action was a general squeeze on sellers across the board including Oil, Copper and Gold. Economic numbers remain buoyant which has supported the ‘Buy The Dip’ mentality in shares while waiting for the Fed to get more active. The USD continues to range and consolidate the highs ahead of interest rates while bond yields, especially short dated bonds, continue to edge higher. I would expect much of the same for the USD and Bonds as traders will be eager to hear what the Fed has to say in its statement. AUS Monetary Policy Meeting Minutes at 11:30am AEST, EUR German PPI at 4pm AEST, CAD CPI Data at 10:30pm and EUR ECB President Lagarde Speaks at 3am AEST.
Asian markets are going to open stronger after an early selloff was brushed aside for a rally into the US session. SPI200 and Nikkei are extended so happy to be ‘scalpy’ on long setups.
The ASX200 is expected to open UP 50 points as earlier losses were brushed aside on the SPI before the ramp higher.
SPI200 (Dec) overnight futures up 55 pts to 6776
SP500 up 26.56 pts to 3899.89
NASDAQ Composite up 86.62 pts to 11535.02
Dow Jones up 197.26 pts to 31019.68
DAX30 up 61.98 pts to 12803.24
GOLD (Spot) up $0.19 to $1675.70 an ounce
COPPER futures US session (Comex Dec) up $0.0090 to $3.5255 a pound
OIL futures US Session (Nymex Oct) up $0.62 to $85.73
CRB Index up 0.90 pts to 279.78
AUDUSD trading at 0.6728
EURUSD trading at 1.0026
GBPUSD trading at 1.1435
USDJPY trading at 143.2000
USD Index US Session (ICE Dec) down 0.156 to 109.350
The SPI200/ASX200 had a big rally off the overnight session lows which seemed overly enthusiastic considering other markets. Price is extended in the short term but the flush of longer term lows on the ASX200 could bring in buyers on the open. I feel that the rally is more of a squeeze on shorts than a new move up, especially ahead of the FOMC rate decision. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW flushed 30545 to trap shorts before ramping higher through 30890 into the US close. Price has pushed above the EMAs although it is extended so happy to wait for a pullback and higher low confirmation prior to a long. For a short, happy to work off a lower high. The US Tech 100 was much the same as the DOW with a test into support around 11725 before a ramp higher into 12005. Price is also extended so will look to work longs off a pullback potentially around the 11900 zone while I need to see a lower high off 12005 for shorts. The Hang Seng continued lower yesterday after an early spike higher on the open. Price later found support around 18655 and squeezed out shorts in overnight trade. The overall trend down remains in tact and I would expect a choppy session today so looking to work off 18755 or a clear lower high or higher low. The Nikkei had a relatively contained day session before a selloff into the European open. Interest rate and inflation jitters have traders very short term minded which is creating the volatility and can be seen in the Nikkei ramp to 27795 into the US close…400 points off lows. I expect a flush higher into 27795 to either trap buyers for a move down or clear the way for a rally off a higher low.
Cryptos edged higher after an early flush lower. Bitcoin took a hit at the start of Asian trade and then managed to make back the losses into the US close. Ethereum was much the same and remains in a downtrend. Both are a little stretched so happy to watch what happens on pullbacks for any long setup. For shorts, just watching for a lower high shoulder setup. BTC will be interesting to see if the 18810 level is viewed as a double bottom or not…we will soon see with the reaction from bulls.
Spot Gold has edged higher off a higher low around 1660 as mentioned in yesterdays report. As longs as price holds below 1691 (and the USD holds highs), I expect to see choppy price action and sellers pressuring lower. Watching to see how price reacts around 1680 today. Crude Oil had a big move down before turning sharply to spike straight back up. The 85.95 area is holding the action down so happy to be biased short off lower highs for now. For a long, I would like to see 84.05 tested and hold. USD Index continues to range between 109.300 and 110.290 which I expect will be the same for today. Price may break down to squeeze out buyers but I expect that such a move down will be short lived until traders hear what the Fed has to say.
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US Tech 100 Index
Hang Seng Index
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