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THE LONDON OPEN 05-10-2022

Started by PocketOption, Oct 06, 2022, 08:04 am

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THE LONDON OPEN 05-10-2022

EUROPEAN EQUITIES OPENED LOWER DESPITE A POSITIVE ASIAN SESSION; THE RBNZ HIKED INTEREST RATE AS EXPECTED, AND MARKET VOLATILITY CONTINUES TO BE SUSTAINED.


European stocks started the session down, despite a strong performance by Asian stock exchanges, where the ASX200 index gained 1.74% and the Nikkei 0.48%. Yesterday also confirmed a return of positive sentiment in the market. Still, this bullish movement that has characterized the past two days may be a rally in a market that continues to be bearish. Investors positively took the latest (negative) news from the States as a sign of a possible slowdown by the FED in its “ultra-restrictive” policy. Yesterday the data on new JOLTs jobs was released, which came in at 10.053M against the expected 10.775, the lowest level since August 2021. The market thus seems to be starting to price in a central bank monetary policy that is beginning to show its effects but should this not be accompanied by a clear decrease in inflation, this bullish equity rally may be short-lived.


Elsewhere, the RBNZ raised interest rates by 50 bp in the fifth consecutive increase of the same amount, making it known that it was also considering a more significant increase. There is also growing anticipation for the outcome of the OPEC+ meeting, which is to decide on production cuts of between 1 and 2 million barrels per day.


As for the macroeconomic calendar, today, investors will focus on data from various European countries on the services sector purchasing managers’ index and the composite PMI. In the afternoon, the focus will shift to U.S. data. Of these, the most interesting will undoubtedly be the ADP nonfarm employment change, the ISM non-manufacturing PMI and crude oil inventories.




EURUSD, M15



The EURUSD overcame the W-2 VAH and consolidated above it. From a technical point of view, the 0.9967 mark is the most significant intraday support. In contrast, the most critical intraday resistance area is the W-3 POC. As long as prices remain above the support, a continuation of the current trend to target the resistance and the W-2 VAH in extension is the most likely scenario. On the flip side, if prices break the support downward, a retracement is expected to target the LVN around the 0.9907 mark.


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: 0.9967, 0.9907.


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: 1.0007, 1.0029.


GBPUSD, M15



The GBPUSD, in contrast with the EURUSD, found sellers around the W-2 VAH, which is the main intraday resistance area. At the same time, the most crucial intraday support area is the 1.1397 mark, which is the current weekly VAH. From a technical point of view, as long as prices remain capped by the resistance, the most likely scenario is a retracement to retest the current weekly VAH. On the other hand, if prices can consolidate above the resistance, a stretch to the W-3 POC and the W-2 VAH 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: 1.1397, 1.1346.


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: 1.1526, 1.1598.


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 05-10-2022 appeared first on Key To Markets Blog.


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