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Matteo Marchetti Market Strategist
Analysis, Market Analysis | August 9, 2022

THE LONDON OPENING 09-08-2022

EUROPEAN EQUITIES OPENED MARGINALLY LOWER AFTER A MIXED ASIAN SESSION; ALL MARKETS REMAIN UNMOVED, WITH INVESTORS WAITING TO SEE IF THE INFLATION PEAK HAS BEEN PASSED

European equities started this Tuesday with a slight decline in the wake of a mixed Asian session, where the worst performer was the Nikkei, which dropped -0.87% after the more than disappointing results of investment giant Softbank; the ChinaA50 index remained stationary around parity, as did the ASX200, which rose 0.13%. Investors remain cautious as they wait for this week’s critical data, the US CPI, to see if the inflation spike has been surpassed and, more importantly, what the Fed’s next monetary policy moves will be.

Oil prices rebounded sharply after trying to update multi-month lows following news that the European Union is trying to revive the 2015 US-Iran deal. That agreement, if ratified, could lead to the Asian country increasing its oil exports by about 1 million barrels per day, which would flow into global markets.

Regarding the macroeconomic calendar, no notable data will be released today, apart from the US EIA Short-term Energy Outlook.


EURUSD, M15

The EURUSD rose yesterday and reached the main resistance around the W-2 VAH. However, it posted a bearish engulfing around the area, and prices started to drop again toward the primary support, the W-1 VAL. The trend will remain sideways until one of the two areas is broken. At that point, we could see a rise in volatility that could lead the pair to lower lows or higher highs. From a technical point of view, the W-2 VAH and the W-1 VAL remain the most significant intraday resistance and support areas. If prices break the 1.0181 mark downward, they could drop toward the following support around the W-2 POC. On the other hand, if prices break the 1.0214 mark, they could stretch toward the higher resistance around the W-1 POC.

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: 1.0181, 1.0155.

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: 1.0234, 1.0214.

GBPUSD, M15

From an intraday perspective, the cable is in a sideways trend, fighting to overcome the main intraday resistance area around the W-1 VAL. The most significant intraday support is around the 1.2053 mark, with the intermediate support around the 1.2070 mark. From a technical point of view, until prices remain below the W-1 VAL, the most likely scenario is a drop to the intermediate support and then to the W-2 POC. On the flip side, if prices succeed in breaking the resistance upward, a stretch toward the W-2 VAH & W-1 POC 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: 1.2070, 1.2053, 1.2026.

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: 1.2095, 1.2145.

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