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OVERNIGHT MARKET SNAPSHOT FOR TUESDAY 19/01/21 (as at 8am AEDT)
- SPI200 (Mar) overnight futures up 39 pts to 6636
- SP500 closed
- NASDAQ closed
- Dow Jones closed
- FTSE100 down 15.06 pts to 6720.65
- DAX30 up 60.62 pts to 13,848.35
- GOLD futures US session (Feb) up $6.90 to $1836.80 an ounce
- COPPER futures US session (Comex Mar) up $0.0115 to $3.6135 a pound
- OIL futures US Session (Nymex Feb) down $0.27 to $52.09 a barrel
- CRB Index closed
- AUDUSD trading at 0.7684
- EURUSD trading at 1.2077
- GBPUSD trading at 1.3587
- USDJPY trading at 103.6900
- USD Index US Session (ICE Mar) up 0.019 to 90.773
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US indexes were closed for trading to celebrate Martin Luther King Jr. Day leaving traders to mull over their risk exposure to current markets. Traders will be watching wall streets reaction to new Biden picks for regulators after his team confirmed on Monday it planned to nominate two consumer champions to lead top financial agencies. The nominations may have signaled a tougher stance will be taken on the industry than many have originally thought. In Europe, major Indexes took a breather as the US was closed. The DAX managed to grind out some gains after the previous sessions selloff while the FTSE ended slightly lower in a range bound market. Traders were not helped by China’s economic data after GDP showed their economy picked up speed in the fourth quarter and is set to expand further this year as the global pandemic continues.
The USD Index remains the focus for currency traders as it ended the session where it started after pushing higher in a follow on from Fridays move in a thin market. Price continues to hover around the 90.800 zone but if buyers support the area, expect to see an extension of the recent bullish move up to 91.150. If sellers start back in from current levels, we expect to see an unwind and squeeze of recent buying action for a move lower. The EURUSD was relatively range bound as there was no lead from the US. Price consolidated Fridays move down although hard to read much into price action until the US re-opens for trade tonight. For now the trend is down off recent major highs around 1.2340 and we will be watching to see if a retest of the 1.2120 zone is on the cards before another push lower. The GBPUSD took the opportunity in a thin market to push lower and squeeze out some more buyers before bouncing back to end the session where it started. From here it will be interesting to see if the Pound builds a lower high for a bigger move lower or holds above 1.3520 to build a higher low for a squeeze up through 1.3700. Recent data showed that USD shorts have built up in the prior week so the short conviction into the dollar remains which may point to a move up in Pound. The AUDUSD, like the Pound, squeezed lower to test into support around 0.7660 before bouncing back into the close. Bulls will be watching this level to hold in the near term for further upside and a push into new highs and a move to 0.8100. If not then further contraction lower of the uptrend is on the cards. The USDJPY remained above the 103.610 support area but continues to look heavy. The area is a prime target for a stop loss run so it will be interesting to see if a flush then move higher is the play or further weakness for a run down towards lows. Expect the a key move will be dependent on the USD which may not get traction until the US session.
SPOT GOLD took the opportunity to flush stop losses below the 1820 area in a thin market at the start of the Asian session yesterday. Price later bounced back and is at a transition point currently as price looks set to hold a higher low around 1829 for a run back to 1860. On the flip side, if sellers manage to hold the 1840 level, we see the potential for a big move lower towards 1768 lows as bulls get caught offside. Crude Oil managed to fend off a move lower early in the Asian session before edging higher through European trade. For bulls, a key move up through 52.53 will see a move back to test recent highs around 53.80. If the level holds then expect a deeper corrective move lower potentially to 51.00. Traders are currently assessing the global climate and what that means to demand as vaccines are slower than expected to filter through to needy economies. Copper saw a major flush and spike into support around 3.5565 before bouncing back strong . The flush lower in a thin trading environment leads us to think that buyers are happy to support price and looking to another push higher in the near term. If buyers can consolidate today above the 3.6000 area then we may see a run up later tonight…again this will depend largely on the USD move.
Cryptocurrencies were mixed with key pairs seeming to be caught in a short term ranging market awaiting further direction. Bitcoin is currently trading at $36277.3 down 0.72% while Ethereum is at 1233.93 down 2.22% and Ripple is at $0.28223 up 0.58%.
The ASX200 started the new week with bears following on from Fridays selling to hit the market from the open and push price back into previous lows around 6658. The index ended the day down 52.4 points to 6663 as most sectors ended in the red. The Metals and Mining sector weighed most on the market with Materials and Resources not far behind and Financials also saw some profit taking to move lower. Falling stocks outnumbered advancing ones by 909 to 472 and 313 ended unchanged.
The ASX200 is expected to open up 35 points on some bargain hunting after the SPI200 moved up off the days session overnight.
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ECONOMIC DATA OUT TODAY (AEDT)
EUR German Final CPI 6pm
EUR Current Account 8pm
EUR ZEW Economic Sentiment 9pm
GBP MPC Member Haldane Speaks 5am
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SPI200 INTRADAY LEVELS TO WATCH
