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Daily Market Outlook, November 30, 2022
‘Markets Await Fed Chair Powell’s Speech This Evening...’
Wall Street witnessed another intraday sell-off on the back of adverse OPEC headlines that suggested the cartel will leave output unchanged, while markets were anticipating a potential cut in production at their upcoming meeting given the global growth impact of China's ongoing Covid crisis. Asian equity markets and US futures staged another rebound overnight as investors continue to bet on an eventual China reopening and anticipated supportive policy measures, however, data overnight suggested that the Chinese economy continues to be impacted by Covid with factory and services data weakening further into contractionary territory. In the UK data released this morning showed a further economic decline with the Lloyds Business Barometer falling again in November and the British Retail Consortium showing a further increase in shop price inflation, with a notable surge in food price inflation to an eye-watering 12.4% year over year.
For the day ahead, in the Eurozone investors will be focused on CPI, with markets braced for a continuation of double-digit levels of inflation, although, a softening from the 10.6% print in October to 10.4% for November is expected, the first decline in 17 months as a result of the ECB's record rate increases in recent months. In the US markets will eye GDP data which is expected to print a positive 2.7% for Q3, while ADP employment data is expected to confirm further tightness in the labour market ahead of Friday's Non-Farm Payrolls report, however, these releases will play second fiddle today to FOMC Chair Powell, who is due to give remarks this evening on the economic outlook and the US employment situation. His comment will be parsed by investors for clues as to the rate path trajectory and hints as to the terminal level for interest rates in the US, given the recent hawkishness and suggestions by Fed officials of a 5-7% target zone, further confirmation of this hawkish view will likely weigh on risk sentiment.
Overnight Headlines
China Economic Activity Falls As Covid Cases Surge To Record
IMF Chief Flags Possible Downgrade In China's GDP Forecast
Japan Factory Output Falls Again On Global Slowdown, Weak Chip Demand
Australia Monthly Inflation Slows In October, Hints At Possible Peak
US House Plans To Move Fast To Avert Rail Strike Despite Objections
Inflation In UK Shops Rises To Highest Level On Record
Dollar Near One-Week High As Traders Prepare For Powell, Payrolls Tests
Oil Rises A Third Day On OPEC+ Cut Chatter, Falling Stockpiles
OPEC+ Leans Toward Maintaining Flat Production, Delegates Say
Chevron To Send First Venezuelan Crude Shipment To US By Late December
Asia Stocks Choppy As Investors Cautious After Disappointing China Data
Chinese City Hosting Key iPhone Plant Lifts Covid Lockdown
HPE Projects Sales That Top Estimates On Office Upgrades
Cyber Monday Sets Sales Record As Shoppers Splurge On Toys, Electronics
Technical & Trade Views
SP500 Bias: Bullish Above Bearish Below 3930/40
Technicals
Primary support is 3930/40
Primary upside objective is 4120
Next pattern confirmation, acceptance above 4050
Failure below 3930 opens a test of 3900
20 Day VWAP bullish, 5 Day VWAP bearish
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EURUSD Bias: Bullish Above Bearish below 1.0340
Technicals
Primary support is 1.0340
Primary upside objective is 1.0620
Next pattern confirmation, acceptance above 1.0485
Failure below 1.03 opens a test of 1.0220
20 Day VWAP bullish, 5 Day VWAP bullish
Today’s New York Cut Option Expiries: 1.0250 (493M), 1.0290-00 (1.32BLN), 1.0330 (367M) 1.0340-50 (705M), 1.0370-80 (1.11BLN), 1.0405-15 (800M) 1.0420-25 (619M)
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GBPUSD Bias: Bullish Above Bearish below 1.1950
Technicals
Primary support is 1.1950
Primary upside objective 1.22
Next pattern confirmation, acceptance above 1.21
Failure below 1.19 opens a test of 1.1770
20 Day VWAP bullish, 5 Day VWAP bullish
Today’s New York Cut Option Expiries: 1.2050 (941M)
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USDJPY Bias: Bullish above Bearish Below 140
Technicals
Primary resistance is 140
Primary downside objective is 136
Next pattern confirmation, acceptance below 138
Acceptance above 142.20 opens a test of 143
20 Day VWAP bearish, 5 Day VWAP bearish
Today's New York Cut Option Expiries: 138.50 (457M), 139.00 (295M), 140.00 (270M), 140.25 (810M)
EUR/JPY: 140.00 (470M), 144.00 (290M)
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AUDUSD Bias: Bullish Above Bearish below .6650
Technicals
Primary support is .6650
Primary upside objective is .6900
Next pattern confirmation, acceptance above .6775
Failure below .6660 opens a test of .6600
20 Day VWAP bullish, 5 Day VWAP bullish
Today’s New York Cut Option Expiries: 0.6600 (577M), 0.6645 (217M), 0.6700 (254M), 0.6735 (708M) 0.6775 (331M)
NZD/USD: 0.6300 (270M)
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BTCUSD Bias: Intraday Bullish Above Bearish below 16100
Technicals
Intraday 16100 is primary resistance
Primary upside objective is 17100
Next pattern confirmation, acceptance below 16750
Failure 16000 opens a test of 15500
20 Day VWAP bearish, 5 Day VWAP bullish
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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!