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OVERNIGHT MARKET SNAPSHOT FOR THURSDAY 11/02/21 (as at 8am AEDT)
- SPI200 (Mar) overnight futures down 33 pts to 6766
- SP500 down 5.06 pts to 3906.17
- NASDAQ down 35.16 pts to 13,972.54
- Dow Jones up 61.97 pts to 31,437.80
- FTSE100 down 7.20 pts to 6524.36
- DAX30 down 78.83 pts to 13,932.97
- GOLD futures US session (Feb) up $4.70 to $1840.00 an ounce
- COPPER futures US session (Comex Mar) up $0.0535 to $3.7735 a pound
- OIL futures US Session (Nymex Mar) up $0.16 to $58.52 a barrel
- CRB Index down 0.16 pts to 184.07
- AUDUSD trading at 0.7720
- EURUSD trading at 1.2121
- GBPUSD trading at 1.3834
- USDJPY trading at 104.6300
- USD Index US Session (ICE Mar) up 0.002 to 90.420
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US indexes were hit hard on the open after, starting the session in new all time high levels, before the addiction to stimulus continued to support the action and bulls rallied back. Inflation is coming more and more into the limelight as economic data shows a recovery. We expect that inflation may lead to some profit taking as overextended prices are locked away. Fed Chair Powell called for efforts from Government and the private sector in a ‘society wide commitment’ to reach full employment saying more is needed. He also pledged continued loose monetary policy to help the process but this all does highlight the concerns over the current jobs market from the Fed Reserve. He also eluded to putting aside any concerns for the massive debt issues and for a more comprehensive approach to end the jobs crisis. The DOW closed up 0.20% while the broader SP500 ended down 0.13% and the Nasdaq closed up 0.25% for the session. In Europe, major Indexes were hit into the close by a weak US open and gave up all the earlier gains plus more. The DAX Index is not looking so rosy as price broke down through support. The UK FTSE is also finding selling pressure to cap rallies as markets start to show some cracks.
The USD Index toyed with new lows made during the European session and continues to look heavy as traders digest Powells comments. The recent leg down is being held in place around 90.488 and a break below 90.282 will lead to a further push into 90.000. Bears suggest that the dollar fall is far from over in the longer term and this may be the case when factoring in Powells comments and concerns for the labour market….meaning more dollar spending supply. The EURUSD again simply traded inversely to the dollar and hovered up at highs. The Euro does look like sellers want to squeeze out some buyers so we will be watching the reaction of buyers on a test down to 1.2113. If the level breaks then we may see a deeper correction lower. The GBPUSD popped higher after the US CPI numbers before edging its way lower as the bullish momentum slows. Price remains in an uptrend but may need to put some buyers on the sidelines before a new leg up. For now, a clear break of 1.3825 may trigger some sellers into action. The AUDUSD found some sellers up into the 0.7760 area as rallies were capped and price pressured lower. This may be pointing to some risk off in the short term for share markets and a bounce in the USD as the majors are in extended territory. The USDJPY started to see a jump in the volatility as a push into the 104.400 area was quickly rejected and lower highs were broken. The move saw some recent sellers lock in some gains so we are watching for more of the same and a run higher if 104.500 can hold as support.
SPOT GOLD tried in vane to hold above the 1845 area after a spike on the back of the US CPI number. Price was quick to push back below the level which suggests that buyers just wanted to clean out some stops before a move lower. The key for bulls to hold now is the 1832 area…if they can not then expect a decent move lower. The inflation narrative may provide some support down the track in the medium term but expect some more pressure from bears. Crude Oil took a hit on the US open only to be later supported by a bigger drop in US Inventories than expected. Price managed to recovery the losses and trade up through earlier highs around 58.76. The move was a good flush of late buyers so we see that the supply demand expectations will continue to support the action to target the 60 round number. Copper took a hit also on the US open as share indexes moved lower. Unlike Oil, Copper could not recover the losses and moved sideways as the USD held up off lows. Despite this, price remains in an uptrend holding higher levels so we see the potential for this to continue today. If the USD decides to bounce off lows to clear out some sellers then Copper will take a hit.
Cryptocurrencies generally saw some more heat come out of the recent rally as prices moved lower through European and US trade. Bitcoin is set to hold a lower high and further pressure buyers if the 43700 level can not hold. Bitcoin is currently trading at $44649.1 down 5.37% while Ethereum is at $1715.84 down 2.84% and Ripple is at $0.48369 up 3.20%.
The ASX200 made back some of the previous sessions losses yesterday as the Index ended the day up 35.7 points to 6856.9. The index did back away from the days highs into the close as traders remain skeptical at current levels. The IT sector was up 3.12% and by far the biggest mover while Utilities were not far behind. Rising stocks outnumbered declining ones by 699 to 672 and 343 ended unchanged.
The ASX200 is expected to open down 30 points as the SPI200 came under pressure overnight.
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ECONOMIC DATA OUT TODAY (AEDT)
JPY Bank Holiday
CNY Bank Holiday
EUR EU Economic Forecasts 9pm
USD Unemployment Claims 12:30am
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SPI200 INTRADAY LEVELS TO WATCH
