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 FRIDAY 2/12/22
US Indexes were happy to consolidate the previous sessions gains as traders deciphered the inflation data. The PCE Price Index came in weaker than expected while unemployment claims were also weaker which sets up for an interesting Payroll release ahead of the US open. Manufacturing data had bears pointing to a ‘likely recession’ as the release showed activity contracted for the first time in 2.5 years. Bond yields continued lower while the USD pushed further down into support which helped provide support the share market. With the risk on move the previous session, US trade was more of investors consolidating as the Consumer remains resilient potentially pointing to a rally into year end as many will still be light on in portfolios. If we see payrolls show employment easing, then we may see traders focus more on a slowing economy and lock away some gains into the weekend. At this stage there remains a equal argument for both bulls and bears and easing off rate rises too soon will potentially create more inflation down the road and a bigger problem for the Fed. (All times AEDT) AUD Retail Sales at 11:30am, JPY BOJ Gov Kuroda Speaks at 12:30pm, AUD RBA Gov Lowe Speaks at 1:40pm, EUR ECB President Lagarde Speaks at 1:40pm, NZD RBNZ Gov Orr Speaks at 3:30pm, EUR German Import Prices and Trade Balance at 6pm, CAD Employment Change and Unemployment Rate at 12:30am and USD Non-farm Employment Change and Unemployment Rate at 12:30am.
Asian markets may be mixed on the open with the SPI looking set for a move up into resistance while the Nikkei gave back all of the US CPI gains. The Hang Seng reacted down off resistance yesterday so may further unwind longs today.
The ASX200 is expected to open DOWN 5 points after the SPI200 traded in a tight range in the overnight session.
Prices below as at 9am AEDT
SPI200 (Dec) overnight futures down 15 pts to 7351
SP500 down 3.54 pts to 4076.57
NASDAQ Composite up 14.45 pts to 11482.45
Dow Jones down 194.76 pts to 34395.01
FTSE100 down 14.56 pts to 7558.49
DAX40 up 93.26 pts to 14490.30
GOLD (Spot) up $34.38 to $1802.95 an ounce
COPPER futures US session (Comex Mar) up $0.0588 to $3.7968 a pound
OIL futures US Session (Nymex Jan) up $0.67 to $81.22
CRB Index down 0.29 pts to 279.46
AUDUSD trading at 0.6806
EURUSD trading at 1.0523
GBPUSD trading at 1.2258
USDJPY trading at 135.3100
USD Index US Session (ICE Dec) down 1.237 to 104.660
The SPI200/ASX200 held between 7368 and 7330 support as traders were happy to remain in a holding pattern into the key US employment data release. Watching the 7356 resistance area to see if bears hold the level and selloff into the weekend or whether the level breaks and see a push up into 7368 and above. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW initially flushed up through 34600 to trap more buyers before a selloff below 34395. The Daily resistance level at 34395 is still key and could see a deeper reaction lower if bulls decide to lock away some gains or the employment data does not come out inline with bulls expectations. Looking for a potential unwind of longs and move down towards 33958. The US Tech 100 chopped around 12010 as expected as many tech lovers are hoping for higher prices…or lower interest rates sooner rather than later. I expect that we will see a bigger unwind of recent buyers ahead of the Employment release so watching for a lower high. The Hang Seng saw a spike up into 19163 resistance before a minor selloff yesterday and then a range bound overnight session. I expect that there may be some further sideways action today so looking for an early flush lower and then a higher low. If price initially flushes higher and then starts to fade, then watching for an unwind of recent buyers and a move lower. The Nikkei sold off in overnight trade to give back all of the gains from the US CPI release. Price held a lower high at 28237 and then a minor lower high at 28115. Watching for a flush below 27970 and then a rally as I feel that the overnight selloff was overdone and bargain hunters to provide support today. The DAX moved lower from the European open as buyers locked in some gains. Price action managed to end the session around 14485 but the level is looking shaky. Watching for a flush lower to trap some sellers prior to a rally in the European session. The UK100 came under selling pressure during from the European session into the US close. Price has pushed back into 7542 where I will be watching for bulls to provide some support.
Cryptos eased off highs as traders were happy to lock in some gains. Bitcoin could not hold above 17100 and faded back below the level to close below the EMAs. I am watching BTC for a flush lower into 16750 before bargain hunters provide some support. Ethereum edged back below 1289 but was supported above the anchor to the uptrend at 1258. Watching for buyers to push ETH above 1289 off a higher low.
Spot Gold continued the charge higher as the USD fell further lower. Price closed up around resistance at 1807 so watching to see how sellers react and expect some profit taking into the US employment release for a move lower. Crude Oil spiked up through 82.20 before giving back a lot of the gains into the US close. Hopes for a further production cut from OPEC continued to support buyers but I expect some profit taking soon and a lower high off 82.20 for a squeeze lower. USD Index was all one way action lower as sellers extended the move lower through support around 105.035. With Momentum down easing, I am watching for a test back up into 105.035 before the Employment release when volatility could again kick off.
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US Tech 100 Index
Hang Seng Index
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