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US OPENING BELL 19-10-2022

Started by PocketOption, Oct 21, 2022, 02:03 pm

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PocketOption

US OPENING BELL 19-10-2022

EUROZONE CPI RESULTED IN THE HIGHEST ON RECORD; MARKET SENTIMENT REMAINS MIXED AS UPBEAT EARNINGS COMPETE WITH RISING RATES PROSPECT.


Europe’s major indices pared their mid-session gains and remained mixed. Before the US cash opening, the Dax and the FTSE100 trade at parity, while the Cac40 and the Eurostoxx gain 0.33% and 0.57%, respectively; the Madrid stock exchange, however, is nevertheless negative. In the morning came the much-anticipated European inflation data. The annual figure stood at 9.9% against the expected 10%, while the monthly figure confirmed expectations at 1.2%. The same did the core data, which, both at the annual and monthly level, met analysts’ estimates at 4.8% and 1%, respectively. These readings look all positive, as they were lower or at least in line with expectations. The problem, however, is that many of these readings are the highest recorded since the time series began in 1991, meaning that inflation is still rising and doing so at a sustained pace. The ECB will be called to another jumbo-hike at next week’s meeting. Counterbalancing this harmful data are the earnings of the major US companies, which for the time being, are beating analysts’ estimates and supporting the US market. In any case, the latest inflation data have given a hint that something is changing in the market: until a few months ago, every higher data or data in line with expectations generated strong intraday volatility, often unidirectional; now, instead, the impact of these data on the market seems to have diminished, without any significant intraday movements. Therefore, it appears the market has ‘resigned itself’ to the future heavy rate hikes by the major central banks, having already discounted them. Obviously, this remains only a hypothesis to be confirmed for the time being, as the market trend has shown no signs of inversion yet.


Elsewhere, the dollar is trying to recoup some of its recent losses, with the dollar index returning to close to 113. On the commodities front, on the other hand, the decline in gold and silver continues, which is now pointing to the lows of 28 September. Lastly, on the currency front, the JPY is very close to the next level at which the BoJ should intervene to support the national currency, i.e. the 150 level that has been discussed recently.


As for the macroeconomic calendar, investors will focus today on data from the US (building permits and crude oil stocks) and Canadian inflation.




EURUSD, M15



The EURUSD broke the support area between the Weekly LVN and the W-2 POC this morning after trying (twice) to hold it, and it is now trading below it. From a technical point of view, the support has now become the most significant intraday resistance area, while the most important support is the 0.9749 mark. As long as prices remain below the resistance, a continuation of the drop is expected to target lower supports after a retest of the 0.9800-0.9820 area. On the other hand, a notable rebound can become the most likely scenario in case of a bullish breakout of the resistance. In that case, the target remains the W-2 VAH.


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: 0.9749, 0.9707.


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: 0.9800-0.9820, 0.9904.


S&P500, M30



The S&P500 is trading close to the primary intraday support between the W-3 VAH and the W-2 VAL (the current weekly POC is also located between these two levels). In contrast, the most interesting intraday resistance area is the W-2 POC. From a technical point of view, as long as prices remain above the support, the most likely scenario is a rise toward the resistance. On the flip side, if prices can break the support downward, the trend will likely continue, targeting lower supports around the 3644 mark and the W-1 POC.


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: 3690-3679, 3644, 3589.


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: 3771, 3807.


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 US OPENING BELL 19-10-2022 appeared first on Key To Markets Blog.


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