Key Supports Shatter Across Major Indices
26 October 2023
Welcome to Thursday, dear traders. Today is poised to be particularly notable, with events in the macro calendar promising to stir the waters and significant market movements already in play, particularly in the realm of indices.
The world of indices has been nothing short of turbulent recently. A sharp decline was witnessed yesterday, and this trend is extending its grip into today. Most major indices are currently in the throes of breaking key supports. The S&P 500, for instance, grapples with the breach of the 38.2 Fibonacci, while Dow Jones casts its eyes towards the critical horizontal support stationed at 32,800 points. NASDAQ’s narrative is no less dramatic. After shattering a key horizontal support, it has now breezed past the lower boundary of its wedge pattern and is making its way toward the 38.2 Fibonacci. Over in Europe, the DAX finds itself toe-to-toe with the 38.2 Fibonacci, a testing time indeed.
The currency market, meanwhile, is narrating a tale of American dollar strength. The EURUSD is navigating a downward trajectory, marked by a flag pattern breakout, whereas the American dollar is gathering steam against the Swiss franc. But perhaps the most riveting of all is the American dollar's face-off against the Japanese yen. Currently, it stands on the precipice of a significant milestone: the psychological resistance of 150.
Shifting our gaze to commodities, we find that while precious metals bask in an upward surge, oil seems caught in a tug-of-war. Yesterday, it displayed a staunch defense of its key horizontal supports. Yet, as today unfolds, the bears appear to be making a comeback.
Wednesday evening had the financial community eagerly awaiting earnings from Meta. The aftermath of the disclosure witnessed Meta in the red, shedding 3% in after-hours trading. As we delve deeper into Thursday, anticipation runs high for earnings revelations from Amazon and MasterCard.
But the main event today lies perhaps in the macro calendar. The Eurozone's interest rate decision looms large, with a consensus pointing towards a steady 4.5%. An accompanying press conference will surely be the cherry on top. But there's more. The US is also set to unveil a series of data. Eyes will be trained on the advanced GDP figures, projected to hit 4.5%, and unemployment claims, speculated to be just a tad north of 200,000.
In conclusion, Thursday is proving to be a whirlwind in the trading world. With the markets in flux and a packed calendar of events, traders will undoubtedly be on their toes, ready to navigate the shifting tides.