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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 7pm and DOW and USTech100 at 1:30am .
OVERNIGHT MARKET SNAPSHOT FOR FRIDAY 10/02/23
US Indexes started the session strong to follow on from the bullish European session but the open saw a wave of selling to take indexes lower into the close. The move down with no pullback shows the nervousness of investors in this mixed market. US bond yields ramped higher into new recent highs which lifted the USD and pressured stock market bulls as they are forced to question inflation and re-assess risk…again. Many are searching for a long term bottom in the major Indexes but the bond market suggests that we are not there yet. Gold broke below a key level which may be the start of a bigger move down as the Daily timeframe rolls down off highs. Oil also saw some risk off from the recent run up while Copper moved down off highs to give back earlier gains. The ASX200 may come under some pressure into the weekend as the rally off the 6900 stalls and price is holding lower highs. All in all, it remains a hard market to navigate so risk management must be a priority.
(All times AEDT) AUD RBA Monetary Policy Statement at 11:30am, CNY CPI and PPI at 12:30pm, GBP GDP, Goods Trade Balance and Industrial Production at 6pm, EUR EU Economic Forecasts TENTATIVE, CAD Employment Change and Unemployment Rate at 12:30am, USD Consumer Sentiment at 2am and USD FOMC Member Waller Speaks at 4:30am.
CLICK HERE FOR FULL ECONOMIC DATA OUT TODAY (AEDT) 10/02/23
Asian Markets may see a mixed open with the Hang Seng having to play catchup with the US selloff. Both the ASX200 and Nikkei ended at support so expecting a choppy open.
The ASX200 is expected to open DOWN 30 pts after the SPI200 moved lower along with the US markets.
Prices below as at 9am AEDT
SPI200 (Mar) overnight futures down 26 pts to 7391
SP500 down 36.36 pts to 4081.50
NASDAQ Composite down 120.94 pts to 11789.58
Dow Jones down 249.13 pts to 33699.88
FTSE100 up 25.98 pts to 7911.15
DAX40 up 111.37 pts to 15523.42
GOLD (Spot) down $13.77 to $1861.78 an ounce
COPPER futures US session (Comex Mar) up $0.0327 to $4.0682 a pound
OIL futures US Session (Nymex Mar) down $0.41 to $78.06
CRB Index down 0.45 pts to 270.48
AUDUSD trading at 0.6935
EURUSD trading at 1.0738
GBPUSD trading at 1.2123
USDJPY trading at 131.5600
USD Index US Session (ICE Mar) down 0.177 to 103.095
The ASX200 initially kicked higher through the European session into 7535 before failing miserably down to 7464 support. We did see a minor short squeeze into the close so I expect that bulls will try to lift price on open and hold above 7464 to squeeze out more shorts before potentially rolling over into the close. If sellers open below 7464 and hold then looking for a test into 7440 and potentially lower. (Refer to the Trade The Structure members area for weekly updated ASX200 charts) The DOW took a hit off 34140 on the US open and there was no looking back from sellers until the close. Price reacted up off 33655 so if we see it hold above the level then I expect to see a grind higher to clear out some sellers prior to the US open. The US Tech 100 held a lower high at 12677 and flushed 12410 into the close. Price action is corrective off the highs at 12880 so may have more downside to go before buyers are happy to step in again. If we see a hold below 12443 in the Asian session, then looking for a squeeze potentially down to 12222. If price pushes back above the level I expect to see a grind higher prior to the US open. The Hang Seng edged lower but was closed for the bulk of the move down in the later stages of the US session. I expect to see price open below 21522 so will be looking for a retest of the level to trap some buyers prior to a flush lower potentially into 21333. The Nikkei moved down off 27690 which was hit early in the European session. Price extended down into 27540 in a relatively controlled manner compared to the US indexes. I expect that price will look to clear out some shorts prior to any further downside move so I will be looking for an flush of 27540 and then a grind up ahead of the HSI open and hour later. The DAX squeezed up through 15550 early to trap some longs before the selloff below 15474. I expect to see a squeeze higher prior to a lower high holding and another leg down. I feel that the move down was a little too strong and lacked buying pressure for there NOT to be more downside. The UK100 moved into new all time highs before the selloff. Price bounced off 7888 to remain in an uptrend. I feel that the market will want to continue higher and hold above 7888 into the US open but any lower high that holds may see a break below 7888 and a decent selloff.
Key Cryptos Bitcoin and Ethereum both took a hit as prices broke through clear support. BTC dropped around 4% while ETH dumped around 6%. Prices are in no mans land at the moment so I need to see either a clear lower high to hold for a continuation trade down or a squeeze up to retest 1563 for Ethereum and 22375 for Bitcoin before a potential short setup.
USD Index initially went risk off lower when Europe was rallying but then found buyers on a poor bond auction which pressured short term bond yields higher. With yields higher, it becomes an attractive alternative to shares so we may see more appreciation into the USD for a move into or above 103.580. Spot Gold flushed above 1886 to trap some buyers before heading lower. Price did take out lows at 1861 into the close so bulls will be getting nervous. I expect to see a grind higher but will be watching for a lower high potentially around 1870 which will bring in more sellers for the move down. Crude Oil moved lower into the US Open and tested into 77.05 before seeing a bounce back up. I expect that price may founder above 77.05 but I will be looking for a lower high and a second leg down to potentially break below 77.05 support. If the level holds, then expecting a squeeze higher to clear out some sellers.
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ASX200 Index 5 Min Chart
ASX200 Index 30 Min Chart
DOW Index
US Tech 100 Index
Hang Seng Index
Nikkei Index
DAX Index
UK100 Index
USD Index
Spot Gold
Crude Oil
Bitcoin
Ethereum
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