TRADESETUP

December 20, 2018

The Morning Jumpstart

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OVERNIGHT MARKET SNAPSHOT  (8:10am AEDT)

  • SPI200 (Sep) overnight futures down 23 pts to 5575
  • SP500 down 32.18 pts to 2513.98
  • NASDAQ down 147.08 pts to 6636.83
  • Dow Jones down 351.98 pts to 23,323.66
  • FTSE100 up 64.35 pts to 6765.94
  • DAX30 up 25.32 pts to 10,766.21
  • GOLD futures US Session (Feb) down $8.15 to $1245.45 an ounce
  • COPPER futures US Session (Comex Mar) up $0.0080 to $2.6720 a pound
  • OIL futures US Session (Nymex Jan) up $0.78 to $47.39 a barrel
  • CRB Index up 1.79 pts at 176.21
  • AUDUSD trading at 0.7102
  • EURUSD trading at 1.1372
  • GBPUSD trading at 1.2614
  • USDJPY trading at 112.5900

The US was doing okay up until the Fed announced they lifted interest rates and the market fell over. The Fed stuck to their guns and hiked rates, which was expected, and also forecast fewer rate hikes for 2019. In a statement the Fed said that risks to the economy were ‘roughly balanced’ and they will continue to monitor global and economic developments and implications to the economic outlook. Although the Fed was less ‘Hawkish’ than previous statements, it seems that it was not enough for traders hoping for a better 2019 and shows a ‘gap’ between where the Fed is and market expectations. The DOW was down 1.49%, while the broader SP500 was down 1.32% and the Nasdaq also closed down 2.17%. In Europe Indexes were higher as they anticipated a dovish stance from the US Fed Reserve.

The USD was initially down ahead of the Fed interest rate announcement and then rallied as the market was expecting a more dovish outlook from the Fed. Powell signalled a potential for two more rate rises for 2019 down from three in September. A mixed bag for the major crosses as the GBP and the AUD ended lower while the EUR edged higher and the YEN remained unchanged.

Gold was lower to give up some recent gains as the USD found strength after the interest rate statement from the Fed. Oil managed a small bounce as sellers locked away some gains after the previous session saw the commodity down more than 7%. Copper was in a similar boat to Oil as recent sellers took the opportunity to lock in some gains although price did come off the intraday highs into the close.

Cryptocurrencies had a great night for the bulls as prices were higher across the board. Bitcoin is currently trading at $3733.7 up 4.98% while Ethereum is at $102.29 up 8.21% and Ripple is trading at $0.35798 up 8.17%.

The ASX200 had another rough data but showed some Xmas spirit to claw back some losses into the close. The Index finished down 8.9 points to 5580.6 after earlier being down 33.3 points. Declining stocks outnumbered rising ones by 687 to 475 and 317 ended unchanged.

The ASX200 is expected to open down around 25 points after the SPI200 fell over into the close. Traders will be focused on employment data out today at 11:30am with expectations for up 20K and unemployment to remain at 5%.

 

ECONOMIC DATA OUT TODAY (AEDT)

NZD  GDP Data and Trade Balance  8:45am

AUD  Employment Change and Unemployment Rate  11:30am

JPY  Monetary Policy Statement and BOJ Policy Rate  Tentative

EUR  Current Account  8pm

GBP  Retail Sales  8:30pm

GBP  MPC Official Bank Rate and Monetary Policy Summary  11pm

USD  Unemployment Claims  12:30am

 

SPI200 INTRADAY LEVELS TO WATCH

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