THE LONDON OPEN 06-10-2022

[PocketOption]

THE LONDON OPEN 06-10-2022

EUROPEAN EQUITIES HEDGE HIGHER AFTER A POSITIVE ASIAN SESSION; OPEC+ AGREED TO CUT OUTPUT BY 2 MILLION BARRELS PER DAY, WHILE THE DOLLAR INDEX HOLDS THE 110 AREA.

European markets are up this morning after a positive Asian session on the second-last Chinese holiday, with the ASX200 index gaining 0.03% and the Nikkei 0.70%. More positive data came in yesterday from the States. The most important was the non-farm employment change (ADP), which was higher than expected and came in at 208k against the expected 200k. This data is usually a good anticipator of non-farm payrolls. If it were to be confirmed tomorrow, it might not be favourable for risk-on assets, as it would mean that the FED still has room to continue its rapid and substantial rate hike policy. In the same way, the ISM non-manufacturing index came in at 56.7 versus 56 expected, indicating that the U.S. economy still shows few concrete signs of slowing down.

Meanwhile, WTI oil prices continue to rise after OPEC+ at yesterday’s meeting decided to cut production by 2 million barrels per day, or about 2% of global supply; at the moment, crude oil has put up a performance of more than 10% this week. On the currency front, however, the dollar maintains its strength despite a slight retracement from multi-year highs and still trades above the psychological threshold of 110 (dollar index).

As far as the macroeconomic calendar is concerned, the main events today are the release of the minutes of the ECB monetary policy meeting, initial claims for unemployment benefits in the United States, the Ivey PMI in Canada, and various scheduled speeches by multiple members of the Fed.

EURUSD, M15

The EURUSD failed to retrieve the psychological level of 1.0000 and dropped toward the W-2 POC yesterday. It then posted a discrete recovery and is trading above the current weekly POC. From a technical point of view,  the most significant intraday support is the current weekly PO, while the most critical resistance area is the 0.9927 mark, where the pair posted a triple-top pattern. The most likely scenario is a continuation of the drop to target the POC again. In case of a new breakout of this area, a continuation toward the W-2 POC is expected. On the opposite side, if prices can overcome the 0.9927 mark, a new rise to the W-2 VAH becomes the most likely outcome.

Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 0.9869, 0.9838, 0.9785.

Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 0.9927, 0.9967.

WTI, M15

The WTI rose strongly and is now trying to hold the W-3 POC. From a technical point of view, this is the most significant intraday resistance area, while the most critical resistance area is the W-3 VAH. As long as prices remain above the Support, the most likely scenario is a new rise toward the resistance. On the opposite side, if prices break the support downward, a drop to the LVN around the 86.17 mark is expected.

Main intraday support areas where to look for long trades in case of bullish candlestick pattern or short trades in case of bearish candlestick pattern: 86.89, 86.17, 85.12.

Main intraday resistances areas where to look for short trades in case of bearish candlestick pattern or long trades in case of bullish candlestick pattern: 88.67.

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

The post THE LONDON OPEN 06-10-2022 appeared first on Key To Markets Blog.

Source: THE LONDON OPEN 06-10-2022