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 (AEDT) for underlying indexes are SPI200 at 10am, N225 at 11am, HSI at 12:30am, DAX and UK100 at 6pm and DOW and USTech100 at 12:30am .
OVERNIGHT MARKET SNAPSHOT FOR MONDAY 24/10/22
US Indexes were sharply higher from the open as risk on took centre stage and buyers went bargain hunting. Comments from Fed Reserve officials sent bulls into a spin on hopes that the pace of rate rises will slow. Fed officials said that it is time to ‘discuss’ slowing the pace of rate rises soon so as to keep the economy from an ‘unforced downturn’. Seems officials are trying to support the market and the US will have to get used to higher normalised inflation rates with the target to be above 4.5% for early next year. Expectations are that the Fed will may not look to ‘front load rate rises’ but rather get inflation lower and pause for the market to take a breather and then more gradually raise until inflation is where it is needed to be and keep the economy from falling into recession. The USD nosedived off resistance as bulls locked in recent gains and US Bond Yields spiked lower as bond prices rallied. Gold benefitted from a weak USD while Copper prices also found some love from bulls. (All times AEDT) JPY Flash Manufacturing PMI at 11:30am, EUR French Flash Manufacturing and Services PMI at 6:15pm, EUR German Flash Manufacturing and Services PMI at 6:30pm, GBP Flash Manufacturing and Services PMI at 7:30 pm, USD Flash Manufacturing and Services PMI at 12:45am and Treasury Sec Yellen Speaks at 2am.
Asian markets are going to open stronger and drag in bulls for an opening drive as FOMO kicks in. Happy to go long although need to see a higher low hold first. Shorts off key levels and failed highs.
The ASX200 is expected to open UP after the SPI200 saw a big rally off 6705 support to end the week.
Prices below as at 8am AEDT
SPI200 (Dec) overnight futures up 95 pts to 6764
SP500 up 86.97 pts to 3752.75
NASDAQ Composite up 244.88 pts to 10859.75
Dow Jones up 748.97 pts to 31082.56
FTSE100 up 25.82 pts to 6969.73
DAX40 down 36.51 pts to 12730.90
GOLD (Spot) up $29.40 to $1657.62 an ounce
COPPER futures US session (Comex Dec) up $0.0685 to $3.4790 a pound
OIL futures US Session (Nymex Dec) down $0.54 to $85.05
CRB Index up 0.64 pts to 272.36
AUDUSD trading at 0.6379
EURUSD trading at 0.9862
GBPUSD trading at 1.1303
USDJPY trading at 147.6500
USD Index US Session (ICE Dec) down 0.998 to 111.820
The SPI200/ASX200 initially pushed into support around 6705 before a 126 point rally into the close. Price closed at resistance but I will be looking for bulls to extend on the rally from the ASX open before price fades lower to squeeze out some buyers. The bullish action is extended but could easily ramp higher. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW ended near resistance at 31240 and could flush above the zone in a stop loss hunt during the Asian session. Price is extended so ideally we see a kick higher and then a lower high for the sell setup and squeeze on buyers. If the market really does want to go higher, then there should be a squeeze on sellers before new buyers are happy to enter the action. The US Tech 100 ended just shy of resistance at 11397 which I expect to be targeted on the open today. Like the DOW, if bulls are going to continue to pressure higher then I expect a squeeze lower and then a higher low hold to give new buyers confidence to jump into the action. The Hang Seng reluctantly moved up off 16150 as the US powered higher. The overall Index trend remains down but I feel that bulls may take control today after a higher low held around 16085. Watching open for a squeeze lower and then a higher low to hold. The Nikkei saw a relatively choppy session with a spike up then hard selloff followed by another spike up into the close. Some good support at 26914 could see a move up through 27130 to test into highs from the open. The DAX has opened the day with a gap up in a thin market so watching for some profit taking off 12965 in the Asian market session and then another squeeze up ahead of the US open. The UK100 has also gapped up to clear out some sellers in a thin market but expecting a pullback into 7015 and off a lower high. If we do see a retest into 7015 and price hold, then another bullish European session in on the cards.
Cryptos rallied over the weekend so have opened stronger in a generally bullish start to the new week. Bitcoin is testing into 19680 where I expect will see some profit taking and some pressure down to squeeze out some weekend buyers. Ethereum has also opened stronger with a big spike higher into 1345 where I am watching for some profit taking from buyers and a lower high and squeeze down.
Spot Gold rallied Friday thanks to the USD weakness. Price pushed up into 1661 and is extended so may see some profit taking off the level if it can not push through early. Watching for some minor consolidation around the level and then a lower high. Crude Oil was generally choppy as supply and demand fundamentals continue to fend off a directional bias. Watching the minor inside level at 85.35 to either hold for a move lower or break for a bigger move up through 85.88 potentially into 88.50 highs. USD Index saw a big spike up and then hard selloff into 111.865. Price has now confirmed a double top at 113.910 which may see some more unwinding of buyers for a push below 111.865 if support can not hold.
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US Tech 100 Index
Hang Seng Index
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