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Matteo Marchetti Market Strategist
Analysis, Market Analysis | September 30, 2022

US OPENING BELL 30-09-2022

EUROPEAN EQUITIES REMAINED POSITIVE AHEAD OF THE US OPENING BELL; EUROPEAN INFLATION HIT A DOUBLE-DIGIT RECORD, WHILE THE BETTER THEN EXPECTED GROWTH IN THE UK HELPED SENTIMENT.

The main European indices remained positive mid-session and tried to recover recent losses. Currently, the Dax gains 0.34%, the Cac40 0.78% and the Eurostoxx 0.52%. This morning, market sentiment was partially helped by the UK growth data, where annual GDP for Q2 was 4.4% versus 2.9%, and monthly GDP was 0.2% versus the -0.1% expected. At the same time, French inflation was also down yearly and monthly. However, these positive figures were offset by the more important European inflation figure, which set a new double-digit record at 10% year-on-year (against expectations of 9.7%). The monthly figure was also higher than expected, pushing the ECB to continue its sustained rate hikes policy.

Elsewhere, on the currency front, WTI oil continues to trade above $81 per barrel as it tries to close its first positive week in the last five, while the major precious metals remain stable. Finally, volatility remains high in both European and US markets, with the Vix and Vstoxx currently above the 30 mark.

As for the macroeconomic calendar, as mentioned above, the most important data investors will be watching this afternoon will be the Core PCE Price Index and the PCE Price Index in the US.


EURUSD, M15

The EURUSD failed to remain above the support and reached the most significant intraday resistance area, the W-1 POC. However, the pair posted a bearish pin bar around the area, signalling a potential inversion of the trend. It broke the weekly LVN support and is currently trading below it. From a technical point of view, as long as prices remain below the weekly LVN (which has now turned into resistance), the most likely scenario is a continuation of the drop toward the current weekly VAH. On the other hand, only a breakout of the W-1 POC could lead prices to the W-3 VAL.

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: 0.9707-0.9689, 0.9549.

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: 0.9790, 0.9838, 0.9893.

S&P500, M15

The S&P500 is currently trading below the current weekly POC, which can be considered a negative bias for today. From a technical point of view, the most significant intraday resistance area is the current weekly POC, while the most critical intraday support is the yearly low around the 3600 mark. As long as prices continue to trade below the current weekly POC, the most likely scenario is a continuation of the drop to target the 3600 mark. On the flip side, if prices can retrieve the current weekly POC and consolidate above it, they could stretch to the yearly LVN around the 3704 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: 3600.

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: 3654, 3694, 3704.

Key:

POC= Point of Control
VAH= Value Area High
VAL= Value Area Low
LVN= Low Volume Node
HVN= High Volume Node
W-1= last week
W-2= two weeks ago
W-3= three weeks ago
D-1= yesterday
D-2= two days ago
D-3= three days ago

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