Wall Street led the charge again on Friday night following the BOE rate rise party, as risk sentiment improved across the complex with possible peace talks in Ukraine getting more likely. The USD gained back ground it lost against Euro and Yen while the Aussie dollar continued to push higher, finishing the trading week above the 74 handle. Bond markets saw a small tightening, with the 10 year Treasury yield pushed down slightly to the 2.1% level, still at a three year high. In commodity world, oil prices bounce back again with Brent crude up 1% to remain well above the $100USD per barrel level while most metals lifted, although gold prices waned later in the session to remain nearer the $1920USD per ounce level.
Bitcoin was again contained after seemingly bottoming out here with support building but keeping it at around the $41K level. This still keeps price below the previous weekly highs with the $42K zone the next level of resistance to get past with short term resistance quite solid here:
Looking at share markets in Asia from Friday’s session, where mainland Chinese shares were looking to pause their sharp bounceback but eventually the Shanghai Composite rallied to lift 1.1% to 3251 points while the Hang Seng Index still couldn’t make headway, finishing down 0.4% at 21412 points. This continued volatility remains hard to trade, to say the least, and still questions if this bounceback can be sustained or is just posturing by local authorities to stave off a proper crash, but the daily futures chart looks pretty good, indicating we could get a better bounce as the trading week begins:
Japanese stock markets were looking to stall after their recent advance, but the Nikkei 225 eventually lifting 0.6% to close at 26827 points. The daily futures chart is showing a lot more potential upside here as a bottom has formed alongside Wall Street’s surge. Overhead ATR resistance on the daily chart has been taken out and momentum as swung into the positive zone so it looks good from here to turn this swing trade into a proper rally:
Australian stocks also had a solid session, climbing into the close, with the ASX200 finishing up 0.6% to 7294 points. SPI futures are up nearly 0.8% on the strong Wall Street move on Friday night, with the daily chart showing a lot of potential here as the lower resistance line overhead is taken out for a new weekly high. Momentum is getting a bit ahead of itself but should stabilise as we start the new trading week:
European shares saw some mild sessions with the Eurostoxx 50 index showing German dominance, finishing up 0.4% at 3902 points. This is slowly moving the market closer away from a pure swing trade and into a reflation rally, but really needs to clear the 4040 point area next:
Wall Street lead the way with strong gains across the board with the NASDAQ up 2% while the S&P500 finished 1.1% higher at 4463 points. Price action has zoomed above both four hourly and daily overhead ATR resistance as it climbs well above the 4400 point level, fully completing a weekly bottom with the potential to move out of this correction phase which will help other bourses:
Currency markets saw a slight return to strength for the USD on the back of disappointing home sales figures, with Euro pushed down after a mid week rally saw it rise above the 1.11 level, finishing the week at the mid 1.10 zone instead. The Ukrainian invasion continues to keep a lid on risk taking here but the four hourly chart is no longer showing hesitation with a new weekly high brewing as the union currency build out of a steep decline since the war started:
The USDJPY pair continued its push higher, this time peaking above the 119 level on Friday night as the USD remains a safe haven compared to Yen. Momentum has gotten back into overbought status with a series of higher four hourly sessions albeit with some pauses here and there. Support seems very strong at the 118 handle where I would place an uncle point in the short term:
The Australian dollar continues its strong move after a pause, pushing above the 74 handle as commodity prices bounced back to almost make a new weekly high. The four hourly chart shows a near return to the previous weekly highs with short term momentum nicely overbought although slightly ahead of itself so we could see a mild pullback to the high moving average area to start the new trading week, although I think theres more upside potential here:
Oil markets bounced back after a week of consolidation with support definitely confirmed at the $100USD per barrel level for Brent crude, which finished 1% higher above the $107 level. The psychologically important $100USD level is the clear uncle point going forward to take advantage of any more spikes with short term price action requiring a return to the $110 level to fill this dip:
Gold was unable to make any headway on Friday night, capping off a disappointing week as it still remains under a lot of pressure as it hovers above the $1900USD per ounce level, having suffered a pretty big decline after shooting through the $2000 level. Four hourly momentum remains negative and overhead ATR resistance has not been cleared in the short term, so watch for any break above $1950 to keep things moving along:
