US OPENING BELL 12-01-2023

[PocketOption]

US OPENING BELL 12-01-2023

EUROPEAN STOCKS EDGE HIGHER AND HIT APRIL 2022 HIGHS; THE CHINESE INFLATION RATE ACCELERATES WHILE INVESTORS WORLDWIDE AWAIT FOR THE KEY US CPI DATA.

The European stock market rally continues, with the major indices standing at their highest levels since April 2022. In this respect, the European Stoxx 600 index hit a high of 450 points, while the Dax is gaining 0.77%, the Cac40 0.83% and the Eurostoxx 0.72%.

Investor sentiment continues to be supported by the results of large companies, which are still not showing any dramatic declines, as might have been expected some time ago. In particular, companies are still able to withstand an adverse macroeconomic environment, and the results, although not brilliant, do not show any worrying signs (at least for the time being). In this sense, the British retail giants Tesco and Marks & Spencer reported sales in line with or above expectations this morning.

Meanwhile, Chinese inflation rose to 1.8% year-on-year from an eight-month low reached in November (1.6%). On the other hand, the monthly figure came in at 0 against the forecast of -0.1%.

However, the trading day was somewhat subdued, with few significant movements. The reason for this wait is the US inflation data that will be released in the afternoon. Analysts expect the data to be down from the previous month’s figures. A few hours ago, JPMorgan predicted a possible upward movement in the S&P range of 1.25-2% if annual inflation is in line with expectations, i.e. around 6.4-6.6%. On the other hand, if the figure turns out to be higher than 6.6%, the bank’s analysts predict a possible downward movement in the index in the 2.5-3% range.

Finally, as far as the macroeconomic calendar is concerned, the other data to watch closely this afternoon will be the US initial jobless claims, released a few hours after inflation.

EURUSD, M15

The EURUSD continued its sideways trend and is posting higher lows but not higher highs (volatility compression). As for today, the most significant intraday support is the 1.0720 mark, while the most crucial resistance is the current weekly VAH. From a technical point of view, if prices can definitely consolidate above the resistance, they could stretch to the LVN around the 1.0803 mark. On the other side, prices should break the support downward to assist in a trend inversion. In this case, the first potential target could be the W-2 VAL.

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: 1.0720, 1.0690, 1.0661-1.0656.

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: 1.0765, 1.0803.

S&P500, M30

The S&P500 continues its rise and trades above the most significant intraday resistance (the LVN, now support). The vast majority of today’s movement on the index will be due to the CPI release. Still, for the time being, and from a technical point of view, as long as prices remain above the LVN, the most likely scenario is a continuation toward the uncovered POC around the 4032 mark. On the flip side, a breakout of the two most significant lower support (the current weekly POC and the current weekly VAH) could lead the index to invert the short-term trend. In this case, the first target could be the daily uncovered POC around the 3998 mark.

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: 3964, 3951-3943, 3998.

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: 4032.

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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