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Daily Market Outlook, November 22, 2022
Overnight Asian markets traded with a mixed tone taking the baton from similar action seen on Wall Street, with US indices whipsawing intraday before closing broadly unchanged. Overnight Chinese authorities issued orders for closure of museums and parks across Beijing and increased mass testing across more major cities. The moves in China have once again led to concern in markets that further closures in China will add to the lackluster global growth environment, the relief rally premised on a reduction in restrictions in China is now being unwound. The China restrictions and OPEC leaks regarding potential supply increases, later denied by Saudi Arabia, led to volatility in Oil markets with the benchmark WTI price seeing a $5 plunge before recovering to close flat on the day just above $80 a barrel. Crypto lender Genesis is struggling to secure financing, a day after halting customer redemptions, leading to concerns of the next domino to fall the cryptoverse, investor confidence in the Crypto space remains depressed, following FTX’s collapse leaving over $3billion dollars owed to creditors.
For the day ahead: the Organisation for Economic Cooperations and Development (OECD) is widely expected to underline its pessimistic outlook for the global economy, as inflation and energy price volatility continue to risk pushing major economies into recession. In the UK, markets will be watching OBR officials testimony in front of the House of Commons Committee, given their new found optimism in an economic recovery that outpaces the Bank of England's view, they may also be quizzed about risks to their new fiscal targets. In the Eurozone, the only data of note is consumer confidence, after recovering from record lows last month, market watchers see limited potential for further improvement. With no tier one data of note in the US, markets will once again parse comments from Fed members, yesterday’s speakers suggested a potential for a slower rise in rates, however, Bullard speaks again today and he spooked markets last week with raising the terminal rate expectation to 7% from the previous 5% level, members George and Mester also speak today.
Overnight Headlines
China Covid Cases Near Record High In Test Of Easier Approach
US Dollar Pauses Climb In Asia On Tuesday China Covid Fears Mount
Crypto Brokerage Genesis Is Said To Warn Of Bankruptcy Without Funding
China’s Money Markets Signal Crunch Over In Drop To Two-Year Low
US Presses China To Ease Up On Taiwan As Defence Officials Meet
New Zealand Posts Record Annual Trade Deficit As Imports Surge
Fed Should Be Mindful Of Lags As It Tightens Rates Further, Daly Says
Fed's Mester Says She Supports Smaller Rate Hike In December
ECB’s Holzmann Backs 0.75 Percentage Point Increase In December
ECB's Villeroy: Inflation In France And Europe Will Peak In H1 Of 2023
ECB’s Centeno Sees Conditions To Slow Rate Hikes In December
UST Curve Steepens; Aussie Bonds Steady Before RBA Lowe Speech
Oil Rises In Asia After Saudis Deny Report Of OPEC+ Supply Increase
Russia Reiterates It Won’t Sell Oil To Nations That Introduce Price Cap
China Thought To Be Stockpiling Gold To Cut Greenback Dependence
Asia Stocks Trade Mixed As Weak Yen Fuels Japan Gains; China Tech Falls
Dell Quarterly Profit Jumps On Higher Server Demand, Lower Costs
Technical & Trade Views
SP500 Bias: Bullish Above Bearish Below 3850
Technicals
Primary support is 3850
Primary upside objective is 4120
Next pattern confirmation, acceptance above 4050
Failure below 3800 opens a test of 3760
20 Day VWAP bullish, 5 Day VWAP bearish
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EURUSD Bias: Bullish Above Bearish below 1.0230
Technicals
Primary support is 1.0230
Primary upside objective is 1.0620
Next pattern confirmation, acceptance above 1.04
Failure below 1.0230 opens a test of 1.0180
20 Day VWAP bullish, 5 Day VWAP bearish
Today’s New York Cut Option Expiries: 1.0100 (345M), 1.0200 (350M), 1.0250 (398M)
1.0300-10 (320M), 1.0370-75 (308M)
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GBPUSD Bias: Bullish Above Bearish below 1.1730
Technicals
Primary support is 1.1730
Primary upside objective 1.2050
Next pattern confirmation, acceptance above 1.1970
Failure below 1.17 opens a test of 1.1640
20 Day VWAP bullish, 5 Day VWAP bullish
Today’s New York Cut Option Expiries: N/A
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USDJPY Bias: Bullish above Bearish Below 143
Technicals
Primary resistance is 143
Primary downside objective is 136
Next pattern confirmation, acceptance below 138
Acceptance above 143.30 opens a test of 145
20 Day VWAP bearish, 5 Day VWAP bullish
Today's New York Cut Option Expiries: 139.85 (394M), 140.00 (375M), 141.00 (410M)
141.85 (280M), 142.50 (530M), 144.00 (260M)
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AUDUSD Bias: Bullish Above Bearish below .6560
Technicals
Primary support is .6560
Primary upside objective is .6900
Next pattern confirmation, acceptance above .6775
Failure below .6560 opens a test of .6508
20 Day VWAP bullish, 5 Day VWAP bearish
Today’s New York Cut Option Expiries: N/A
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BTCUSD Bias: Intraday Bullish Above Bearish below 16600
Technicals
Intraday 16600 is primary resistance
Primary downside objective is 15000
Next pattern confirmation, acceptance below 15500
Acceptance above 16700 opens a test of 17100
20 Day VWAP bearish, 5 Day VWAP bearish
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!