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EUROPEAN EQUITIES OPENED HIGHER AFTER A MIXED ASIANS SESSION; THE USD IS TRYING TO RECOVER SOME OF THE RECENT LOSSES WHILE THE CRYPTO TURMOIL CONTINUES.

European stocks opened cautious but positive this week after a mixed Asian session where the ChinaA50 index gained 0.27% while the ASX200 and Nikkei gave up 0.16% and 1.06%, respectively.

Investors thus remain at the window after the end of one of the best weeks in the past five months, thanks to the US inflation data, which surprisingly showed the first sign of subsiding due to the Fed’s aggressive monetary policies. However, several US central bank officials made it clear that they do not see an imminent change in rate policy as likely. Bringing inflation back to the target level of 2% will require either further hikes or long-high rates.

Elsewhere, turbulence continues in the digital currency market, with high volatility on all cryptos, which continue their downward momentum following the FTX exchange bankruptcy, which regulators are now investigating. At the moment, what is critically important to understand is whether there will be a contagion effect and, if so, to what extent.

On the other hand, Commodities are stable, with WTI maintaining gains after favourable news from China last week and thanks to the weakness of the US dollar. Gold and silver are also little moved but have posted solid performances since the beginning of the month, in the order of 8 and 14%, respectively.

As for the macroeconomic calendar, no primary data is expected to be released today, but it will be helpful to follow the scheduled speeches of the various ECB officials.

EURUSD, M15

The EURUSD trades around the most critical long-term resistance area, between the 1.0310 and the 1.0360 marks. The most crucial resistance level for today is the 1.0350 mark. In contrast, the most significant support area is 1.0300. From a technical point of view, as long as prices remain above the support, the most likely scenario is continuing the consolidation phase to break the resistance area upward. On the other hand, if prices break the support, they could move lower toward 1.0285 (LVN) and 1.0250 (LVN).

Main intraday support areas where to look for long trades in case of a bullish candlestick pattern or short trades in case of a bearish candlestick pattern: 1.0300, 1.0285, 1.0250.

Main intraday resistances areas where to look for short trades in case of a bearish candlestick pattern or long trades in case of a bullish candlestick pattern: 1.0310-1.0360 (1.0350).

WTI, M15

The WTI is trading in a parallel channel in a sideways trend. The most crucial intraday support area is the W-3 POC. In contrast, the most significant intraday resistance area is the W-3 VAH. From a technical point of view, as long as prices remain above the support, the most likely scenario is a continuation of the trend to target the upper part of the channel. If prices break the resistance, they could move toward the W-2 VAH and the 90.05 mark (the W-3 VAH). On the flip side, a drop to the W-1 POC could occur if prices fall below the support downward.

Main intraday support areas where to look for long trades in case of a bullish candlestick pattern or short trades in case of a bearish candlestick pattern: 87.78, 87.30, 85.92-85.82.

Main intraday resistances areas where to look for short trades in case of a bearish candlestick pattern or long trades in case of a bullish candlestick pattern: 88.95, 89.61, 90.05.

Key:

POC= Point of Control

VAH= Value Area High

VAL= Value Area Low

LVN= Low Volume Node

HVN= High Volume Node

W-1= last week

W-2= two weeks ago

W-3= three weeks ago

D-1= yesterday

D-2= two days ago

D-3= three days ago

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