ASX 200 futures (SPI 200) were allowed to print a fresh record high on a daily-close basis. Yet 8500 remains a clear level of resistance, and one which prompted a potential bearish reversal pattern.
By :Matt Simpson, Market Analyst
Thursday provided the usual dose of thin trading ranges and low liquidity around Thanksgiving, making technical less reliable. And we could be in for another quiet day heading into the weekend, which means traders have a choice of referring to much lower timeframes in hope of catching smaller moves, being patient with higher timeframes, or simply taking the day off. We also have month-end flows to factor in which can often prompt spurious price action and the occasional unexplained price spike.
Therefore, today’s article will be short and simple and effectively a revision of yesterday’s. My bias towards ASX 200 futures remains bearish but, as always, timing is key.
Events in focus (AEDT):
- 10:30 – JP jobs/applications, Tokyo CPI
- 10:50 – JP industrial production, retail sales
- 11:30 – AU housing credit
- 16:00 – JP construction orders
- 20:30 – UK money supply, mortgage lending
- 21:00 – EU CPI
- 22:00 – UK BOE governor Bailey speaks
- 00:30 – CA GDP
Click the website link below to get our exclusive Guide to index trading in Q4 2024.
https://www.forex.com/en-us/market-outlooks-2024/Q4-indices-outlook/
ASX 200 futures (SPI 200) technical analysis:
I noted that the ASX 200 futures market had so far struggled to break above 8500, and given the weak lead from Wall Street I had a hunch that the ASX could fall on Thursday. But it clearly had other plans, instead opting to retest the 8500 level before closing at a fresh record high.
However, once again the market has struggled to conquer 8500, and the record high was achieved during thin trade. Daily volume was also the lowest in five days, and the record high was really set with a market’s tendency to drift higher as opposed to any sort of aggressive bullish initiation. Ultimately, I remain sceptical of a runaway breakout and on guard for a move lower.
A double top has formed around 8500 and prices broke lower from its supposedly bullish channel. All three Wall Street indices futures markets printed unconvincing up-days within their prior day’s bearish ranges, the S&P 500 remains trapped beneath its own record high.
The bias remains to fade into rallies on the ASX, in anticipation of a move down to 8400. A break beneath the 8378 low brings the 8348 VPOC and 8307 lows into focus.
View the full economic calendar
– Written by Matt Simpson
Follow Matt on Twitter @cLeverEdge
The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.