Macro Morning

See the latest Australian dollar analysis here:

Macro Afternoon

Wall Street has been in retreat for three days in a row now, as risk sentiment slowly catches up to the out of control COVID cases emerging in Europe and the US as they go into their colder seasons. A higher than expected US jobless claims print didn’t help, neither did continued stalemate in the US Congress over stimulus measures, while commodities were mixed across the board. Oil fell back 1% while industrial and precious metals lifted as bond markets were relatively contained, again.

Looking at share markets in Asia from yesterday’s session where the Shanghai Composite struggled throughout its session and finished down 0.2% to 3326 points while in Hong Kong the Hang Seng Index fell sharply to close 2% lower at 24349 points.   The daily chart was showing how the previous swing play was poised to push aside resistance but former support at the 24200 point level was unable to hold here so watch for a follow through below the low moving average area:

Japanese stock markets also took a beating with the Nikkei 225 falling 0.5% to close at 23507 points despite Yen buying abating somewhat. Recent price action had created a new monthly high amid a solid uptrend since the July lows but futures are indicating a stall once more as resistance remains stubborn around the 23500 point level:

The ASX200 was the standout, rising over 0.5% to finish at 6210 points at a new monthly high.  SPI futures are down just 13 points or so this morning with the four hourly chart remaining very illustrative as price remains in a consolidation phase with the 6100 point level still short term support:

European markets fell across the continent and in BrexitLand with the FTSE dropping nearly 0.6% while the German DAX finished nearly 2.5% lower to 12703 points in a big reversal Daily momentum was rolling over prior to this fall as price was unable to clear the early September highs at the 13300 point level. Support must hold at daily ATR around the 12500 point level:

Wall Street continues its own little wobble, with a small fill later in the session so it wouldn’t repeat the European experience. The S&P500 eventually closed only 0.15% lower to 3483 points after being more than 1% lower earlier in the session. The four hourly chart was poised here at short term support at the 3475 level which was broken and then filled – but not yet breached again. I keep asking is this the last push before the November election:

The daily chart of the NASDAQ – which fell 0.5% overnight – is more illustrative. The simple downtrend of lower daily highs is pointing to a rollover here:

Bitcoin is getting more interesting however, note the new resistance level where price is bunching up after the recent breakout above the previous Resistance zone at the $11000 level:

Volatility in currency markets continued to lift overnight as Euro slumped back down to the 1.17 level after its recent shakeout, now making a new weekly low. As I said yesterday, the retracement of last week’s rally may not yet be over as support at the 1.1730 session lows was decidedly broken:

The USDJPY pair was able to eke out a very minor push higher after it recently broke below the two week low to almost get back to the mid 105 level again. Momentum had been oversold as some internal buying support helped translate into a minor swing play here but Yen buying may accelerate if stocks continue to fallover:

The Australian dollar was the big whalloper overnight post the jobs report yesterday with a big fail of the 71.50 level taking it straight down to the 70.50 level and where its struggling after a bounceback to get back above the 71 handle proper his morning:

Oil volatility is still present with another pullback overnight with Brent futures down over 1% to finish just below the $42USD level, after being down substantially more earlier in the session. I still contend its poised to breakout above the previous $44 weekly resistance level as momentum is coiling up for a release higher here:

Gold had a much better ride amongst the undollars overnight with the a retest above the $1900USD per ounce level that stuck properly. I’m watching for a follow through and a retest of the previous session high at the $1912 level or higher tonight with daily trailing ATR resistance at the $1950 level the upside target:

Glossary of Acronyms and Technical Analysis Terms:

ATR: Average True Range – measures the degree of price volatility averaged over a time period

ATR Support/Resistance: a ratcheting mechanism that follows price below/above a trend, that if breached shows above average volatility

CCI:  Commodity Channel Index: a momentum reading that calculates current price away from the statistical mean or “typical” price to indicate overbought (far above the mean) or oversold (far below the mean)

Low/High Moving Average: rolling mean of prices in this case, the low and high for the day/hour which creates a band around the actual price movement

FOMC: Federal Open Market Committee, monthly meeting of Federal Reserve regarding monetary policy (setting interest rates)

DOE: US Department of Energy 

Uncle Point: or stop loss point, a level at which you’ve clearly been wrong on your position, so cry uncle and get out!

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