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OVERNIGHT MARKET SNAPSHOT FOR MONDAY 4/01/21
- SPI200 (Mar) overnight futures closed
- SP500 up 24.03 pts to 3756.07
- NASDAQ up 18.28 pts to 12,888.28
- Dow Jones up 196.92 pts to 30,606.48
- FTSE100 down 95.30 pts to 6460.52
- DAX30 down 42.60 pts to 13,718.78
- GOLD futures US session (Feb) up $8.20 to $1901.60 an ounce
- COPPER futures US session (Comex Mar) up $0.0290 to $3.5200 a pound
- OIL futures US Session (Nymex Feb) up $0.12 to $48.52 a barrel
- CRB Index up 1.12 pts to 167.80
- AUDUSD trading at 0.7713
- EURUSD trading at 1.2234
- GBPUSD trading at 1.3656
- USDJPY trading at 103.2300
- USD Index US Session (ICE Mar) up 0.249 to 89.898
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A new year begins and markets look to continue on from where they left off with the same themes of 2020 supporting bulls. Trump is putting up a fight and may not leave the oval office without causing some issues so markets will be watching closely. We expect to see at least the start of 2021 be a good environment for shares as traders search for yield in a zero percent world flooded with unlimited free money from the world’s central banks. US indexes continue to push higher on stimulus and look set to start the new year on the front foot. Investors will be watching runoff elections in Georgia for two Senate seats on Tuesday. The elections will determine which party controls the Senate so if the Republicans win one or both of the Georgia seats, they will retain a slim majority in the chamber and can block Biden’s legislative goals and judicial nominees. In Europe, major Indexes ended the year on a negative note to follow on from the Asian sessions weakness as traders squared up positions on the final day for 2020.
Nothing much has changed for the USD Index as price continues to step lower and cap off the worst year since 2017. Price did bounce off lows in a quiet session and is retesting the 90 level which may bring in some sellers. We may have to wait and see how the US opens for 2021 trading but do expect that the trend down will continue into the 89.000 zone which are lows from 2018. The USD is expected to face another tough year as rates will stay low and deficits high as the Fed maintains its bloated balance sheet. The EURUSD continued to push higher although did take a breather into the close of 2020 as traders squared up some positions into the end of the year. If the dollar continues to move as it did in 2020, the Euro should continue to find a bid. The GBPUSD held onto highs into the end of the year in a thin market even as the USD rallied late. Price was supported after Britains market watchdog intervened hours before the country leaves the EU with a partial easing on curbs that risked disrupting swaps trades worth billions of euros. The AUDUSD continued to push higher and took out resistance at 0.7665 and now has its eyes set on the 0.8120 area. Expect that the theme of a weak dollar and higher commodity prices will support the Aussie into the start of 2021 although rising local covid cases may suppress bulls. The USDJPY is moving south as the dollar comes under pressure. Price did find some buyers Thursday in a thin session to hold the action above previous lows around 102.900. Price may need to squeeze out some sellers before another leg lower.
SPOT GOLD has climbed as the dollar falls with buyers holding minor higher levels. The action is now being capped around 1900 as sellers again defend the level. A new year may see price start a charge higher as the longer term action looks very constructive with the key zone to watch around 1905/10. Expect that the short term thin markets may keep the action in check for now and we would like to see a major higher low hold prior to a run up. Crude Oil had a choppy few days into the close of 2020. Covid issues continue to cap bullish action while a weaker USD provides some support. Expect that price may continue to struggle below the 50 area with the anchor to the daily trend up around 46.00. Copper is also struggling on a daily basis with recent action looking a little toppy. Traders will be watching global covid cases and the progression and results of the vaccines to start to plan out the new year. We may see some late buyers cleared out before a new leg higher.
Cryptocurrencies are on everyones radar again as Bitcoin is charging higher and dragging in all the crypto enthusiasts with talk of small fortunes being made. There is a flow over into other crypto pairs while some others flounder. Bitcoin is currently trading at $33594 up 8.17% while Ethereum is flying, up 20% at $948.85 and Ripple is lagging trading at $0.22482 up 3.07%.
The ASX200 had a rough session on the last day of the year for 2020 as bulls were happy to take some risk off the table in the low volume shortened session. Expecting to see some volatility on the open as bulls play catch up to the US and we see some repositioning for the new year.
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ECONOMIC DATA OUT TODAY (AEDT)
CNY Caixin Manufacturing PMI 12:45pm
EUR German Final Manufacturing PMI 7:55pm
EUR Final Manufacturing PMI 8pm
GBP Final Manufacturing PMI 8:30pm
ALL OPEC Meetings 8:30pm
USD Final Manufacturing PMI 1:45am
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SPI200 INTRADAY LEVELS TO WATCH
