US OPENING BELL 07-09-2022

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US OPENING BELL 07-09-2022

EUROPEAN EQUITIES REMAIN NEGATIVE DESPITE BETTER-THAN-EXPECTED DATA; THE USD SET ANOTHER RECORD HIGH WHILE THE JPY SLUMPED TO A NEW 24-YEAR LOW.

European stocks try to recover losses but still trade below par at mid-session. The Dax gives up 0.42 %, the Cac40 0.45% and the Eurostoxx 0.49%. Wall Street’s opening is expected to be on the edge of parity but slightly below. This morning, better-than-expected European GDP and employment data appear to have failed to improve sentiment. Specifically, GDP (YoY) (Q2) came in at 4.1% versus the expected 3.9%, while the monthly figure for the same quarter came in at 0.8% versus the expected 0.6%. As for employment, on the other hand, the annual Employment Change figure came in at 2.7% against 2.4% expected, and the quarterly figure came in at 0.4% against 0.3%. According to investors, these data will not be enough to ward off the likely aggressive intervention by the ECB tomorrow on interest rates.

Meanwhile, of note is the new high of the dollar index, which reached the level of about 110.78, which has not been seen since June 18, 2002; at the same time, the Pound tested the low reached at the height of the pandemic in the 1.1430 area, and the JPY reached a new multi-year low in the 144.80 area.

As for the economic calendar, this afternoon, investors will focus on the BoC meeting regarding the interest rate, the U.S. EIA Short-Term Energy Outlook, and various speeches by FOMC members.

EURUSD, M15

This morning the EURUSD, remaining above the most crucial intraday support zone, reached the weekly POC (which was around the 0.9925 mark). However, it failed to reach the current weekly VAH and collapsed again below the POC (which is now around the 0.9908 mark). This move can be considered a negative bias for the rest of the day. From a technical point of view, the setup remained more or less the same. As long as prices manage to hold the support between the current weekly VAL and the 0.9877 mark, the most likely scenario is a pullback to retest the weekly POC. On the other hand, if prices break the support, they could continue to drop toward the medium-term support around the 0.9700 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: 0.9885-0.9877, 0.9850, 0.9700.

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: 0.9907, 0.9933, 0.9945.

S&P500, M30

The S&P 500 is trading below the current weekly Value Area, which is not a positive bias for today. From a technical point of view, as long as prices remain below the most significant resistance area (between the current weekly POC and the VAL), the most likely scenario is a continuation of the current downtrend to target the 3857 mark. On the other hand, if the index breaks the resistance area upward, a stretch to the current weekly VAH and eventually to the W-1 VAL 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: 3880, 3857.

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: 3900-3909, 3934, 3955.

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