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 TUESDAY 25/10/22
US Indexes followed on from where they left off Fridays bullish session to add to gains. I expect that the bulls are soaking up some shares ahead of quarterly results this week from big tech. Apple raised prices on its streaming services which supported the stock and sector. Weaker than expected Manufacturing and Services data supported the overall market on hopes that the Fed will think twice about its stance on interest rate hikes. US Bond yields moved up slightly during the session although the weaker data release gave them pause while the USD help up off support which looks set to hold today. The Hang Seng tumbled yesterday on news of Xi’s third term of 5 years. A cabinet re-shuffle with a departure of pro-stimulus officials and reformers spooked the market on concern of a further crackdown on tech companies. (All times AEDT) AUD Annual Budget TENTATIVE, JPY BOJ Core CPI y/y at 4pm, EUR German ifo Business Climate at 7pm, GBP MPC Member Pill Speaks at 7:55 pm, USD Consumer Confidence at 1am and USD FOMC Member Waller Speaks at 4:55am.
Asian markets will open mixed with the Nikkei and SPI200 bullish while the Hang Seng is under serious pressure. Expecting a grind up today as bulls lacked some conviction overnight.
The ASX200 is expected to open UP 15 points after the SPI200 held below resistance in a relatively range bound session.
Prices below as at 8am AEDT
SPI200 (Dec) overnight futures up 28 pts to 6797
SP500 up 44.59 pts to 3797.34
NASDAQ Composite up 92.89 pts to 10952.61
Dow Jones up 417.06 pts to 31499.62
FTSE100 up 44.26 pts to 7013.99
DAX40 up 200.55 pts to 12931.45
GOLD (Spot) down $8.44 to $1649.47 an ounce
COPPER futures US session (Comex Dec) down $0.0400 to $3.4345 a pound
OIL futures US Session (Nymex Dec) down $0.47 to $84.58
CRB Index down 0.54 pts to 271.82
AUDUSD trading at 0.6310
EURUSD trading at 0.9873
GBPUSD trading at 1.1279
USDJPY trading at 148.9900
USD Index US Session (ICE Dec) down 0.058 to 111.922
The SPI200/ASX200 was largely range bound overnight holding below resistance at 6810. If price opens and breaks down below 6787 I feel that there will be a squeeze on recent buyers. Of course the action could have been held down overnight in anticipation of a rally on the ASX open to play catchup with the US. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW edged higher up off 31240 although momentum is slowing and may trigger some sellers into action. I still expect buyers to push price higher so will be looking for a minor pullback into 31240 for longs. The US Tech 100 held a flush into lows through 11220 before bouncing higher through resistance at 11390 into the US close. With all the big tech quarterly results due this week, I expect bulls to hold higher levels and edge price higher so watching for a higher low. The Hang Seng took a bit hit yesterday from the open and the selling continued overnight. Price flushed into 14806 before holding a minor higher level at 15022. I expect that the flush could be the final capitulation of the leg down so may see some bargain hunting today on the open. Concern is that the Hang Seng index lacks a clear support area and investors remain concerned. The Nikkei held support around 26914 to move up and hold a minor higher low at 27048. Watching to see how buyers react around 27125 and whether bulls can keep the pressure on to the upside and test back up into highs. The DAX spiked higher after an early flush lower but did struggle around 12965 which held into the US close. Momentum is rolling down so I expect to see a pullback but will still be looking for a higher low and short squeeze for an extension up into 13115. The UK100 also flushed lower from the European open before ramping higher. Price struggled around 7015 but looks set to hold the move higher; as long as price remains above 6986; and extend into 7080.
Cryptos gave back some of the weekend rally but generally held a bid and have some bullish price action building. Bitcoin fended off a move below 19225 and remains above the EMAs so I will be looking for a higher low to hold for a move back up. Ethereum had a good move up off 1318 into the US close and looks set to move up off 1345. Like BTC, watching for a minor higher low to hold.
Spot Gold consolidated between 1645 and 1653 as bulls were disappointed with the lack of follow through to the downside on the USD. The minor double bottom at 1645 could drag in some buyers but I am expecting that the USD will find a bid today to hold above support…which means some pressure into Gold. Crude Oil has been choppy but continues to be bid as traders may see fundamentals swing more to the demand side to support Oil prices. Price held a flush into 83.35 and is currently holding above the EMAs so I expect a spike into 85.90 into the European open. USD Index held a flush below 111.865 which is a sign of strength…or stubborn-ness…from bulls. The price could really go either way but I expect that the 111.865 level will hold as Bond yields edge lower.
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US Tech 100 Index
Hang Seng Index
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