–
OVERNIGHT MARKET SNAPSHOT FOR WEDNESDAY 27/05/20 (as at 7:15am AEST)
- SPI200 (Jun) overnight futures down 63 pts to 5744
- SP500 up 36.32 pts to 2991.77
- NASDAQ up 15.64 pts to 9340.22
- Dow Jones up 529.95 pts to 24,995.11
- FTSE100 up 74.48 pts to 6067.76
- DAX30 up 113.37 pts to 11,504.65
- GOLD futures (Aug Contract) down $28.50 to $1725.00 an ounce
- COPPER futures (Comex July) up $0.025 to $2.412 a pound
- OIL futures US Session (Nymex July) up $0.92 to $34.17 a barrel
- CRB Index up 2.09 pts to 131.62
- AUDUSD trading at 0.6650
- EURUSD trading at 1.0980
- GBPUSD trading at 1.2334
- USDJPY trading at 107.5600
- USD Index US Session (ICE June) down 0.895 to 98.993
–
US Indexes opened strong after the long weekend as markets were ramped up through the Asian session into the US open. The SP500 and Nasdaq were actually lower from the open as traders took the opportunity to lock in some gains after the big gap up. Again the bulls were out in force with the rally being based on ‘hope’ for the development of coronavirus vaccine and a quick economic recovery. The rally still has many economists baffled as the economic data does not support the optimism as the US is up 37% from the March lows. Sooner or later the market will run out of steam and traders will be forced to re-assess their exposures and risk levels. We can not ‘guess’ when that may happen but do expect that political headlines, tensions with China and general economic problems will continue to build until they start to outweigh the general optimism. The rally has largely been on the back of the FAANGs stocks (Facebook, Amazon, Apple, Netflix and Google) which make up 20% of the SP500. Interesting to note that the Nasdaq sold off the hardest from the open to end only slightly higher. The DOW powered up 2.17% while the broader SP500 was up 1.23% and the Nasdaq lagged ending up 0.17% for the session. In Europe, major indexes opened strong being supported by a rally in the Asian session. The positive mood continued through the European session as the DAX continued to rally after pushing through key resistance the previous session. Traders were also buoyed by hopes for a quick recovery out of lockdown and a vaccine sooner rather than later.
The USD Index fell like a stone prior to the open for Asian trade which set the scene for the rally into stock indexes. Price pushed straight down to previous minor lows and may be gunning for key support slightly lower. The EURUSD lifted on the back of the dollar weakness as bulls were in control all day. Price is now back up at resistance levels around 1.1000 where we would expect to see some reaction from sellers. The GBPUSD went on a tear higher giving us a great long trade off major support levels. Price is consolidating the highs around 1.2330 so we may still see further strength in the pair as the short squeeze continues. The AUDUSD also took off like a rocket prior to the ASX open as buyers ramped price back up through highs being supported by the positive move into shares. Price is obviously extended so we may see some buyers lock away some gains so will then be looking for a higher low to hold. The USDJPY was choppy but did move lower on USD selling pressure. Price may find support around 107.330 if the dollar can stem the tide of selling.
SPOT GOLD was hit hard as any idea of a safe haven was thrown out the window and recent buyers bailed. Price broke down out of a bullish technical pattern so we may see further selling pressure as longs get unwound. Price will be searching for support below the 1700 level. Crude Oil edged higher but did shows signs of selling pressure as price rejected new highs above 34.66. We are watching a move below 33.79 that will bring in more sellers and a potential short setup. Copper continued its rally through the Asian and European session but then ran into selling pressure from the start of US trade. We are now watching for further selling pressure as the recent trend up has been broken.
Cryptocurrencies were weaker in the European session to retest minor lows. Prices on Bitcoin and Ethereum look to be coming under longer term pressure which will drag on other crypto pairs. Bitcoin is currently trading at $8858.1 down 0.58% while Ethereum is at $202.00 down 1.07% and Ripple is at $0.19483 down 0.29%. It was a very strong day with rising stocks outnumbered declining ones by 821 to 411 and 310 ended unchanged.
The ASX200 moved strong out of the gate yesterday and blasted higher all session to add 164.4 points or 2.93% to 5780. All sectors were up across the board with Financials leading the way up 4.25% while the Telecommunication Services and the Consumer Discretionary sectors were not far behind up 3.30% and 3.11% respectively.
The ASX200 is expected to open down 60 points as the SPI200 edged lower through the US session.
–
ECONOMIC DATA OUT TODAY (AEDT)
AUD Construction Work Done 11:30am
EUR ECB President Lagarde Speaks 5:30pm
USD Richmond Manufacturing Index 12am
USD Beige Book 4am
–
SPI200 INTRADAY LEVELS TO WATCH
