8 Nov: US$, stocks soar on FBI inspired relief rally, assisting the prospect of a Clinton victory

By | November 7, 2016

The intervention of the FBI into the final day of the US election campaign, announcing that there was no new evidence found against Hillary Clinton regarding her handling of emails as secretary of state,  has again had a major impact on global financial markets. Risk sentiment surged on the increased prospect of a Clinton victory, while at the same time diminishing the chances of a Trump victory and the uncertainty that that would bring with it.  Stocks and the dollar both gapped higher at the Asian open and continued to trade strongly through the session, while Gold reversed some of recent gains due to the dollar strength.

The coming session will be all about the US election but, elsewhere, some volatility could be created by the China October Trade Balance (exp $51.7 bio, Exp -6%, Imp -1%). That aside, the NAB Business Conditions/Confidence is due, while from Europe we get the German Industrial Production, the UK Manufacturing/Industrial Production figures for September and the NIESR GDP Estimate.

CURRENCIES
EURUSD: 1.1045
Res  1.1060  1.1085  1.1140
Sup  1.1025  1.0995  1.0960
USDJPY: 104.48
Res  104.65  105.00  105.50
Sup  104.00  103.75  103.20
GBPUSD: 1.2402
Res  1.2440  1.2505  1.2555
Sup  1.2380  1.2335  1.2290
USDCHF: 0.9739
Res  0.9775  0.9790  0.9830
Sup  0.9730  0.9695  0.9680
AUDUSD: 0.7714
Res  0.7720  0.7735  0.7755
Sup  0.7680  0.7655  0.7640
NZDUSD: 0.7324
Res  0.7345  0.7370  0.7415
Sup  0.7290  0.7265  0.7220
INDICES / COMMODITIES
S+P: 2121
Res  2124  2140  2150
Sup  2106  2094  2080
DJI: 18129
Res  18165  18210  18300
Sup  18050  17980  17890
ASX SPI: 5247
Res  5260  5280  5304
Sup  5220  5200  5166
GOLD: 1281
Res  1286  1296  1302
Sup  1278  1270  1262
SILVER: 18.21
Res  18.40  18.60  18.75
Sup  18.00  17.80  17.55
OIL (WTI): 44.90
Res  45.00  45.60  46.45
Sup  44.05  43.50  43.00

 

Indices/commodities
S&P Futures 2121
Resistance Support
2163  10 Oct high 2110 Minor
2149 25 Oct high 2102 Session low
2140 Minor descending trend resistance/100 DMA 2081 Chart Gap
2130 31 Oct high /200 HMA 2078 4 Nov low /200 DMA
2124 Session high 2066 6 July low

Bias                                                                                                           

Stocks have staged a decent relief rally, with the S+P reaching 2124 and closing near the day’s highs, creating a 20 point chart gap in the process. The charts do seem to hint at further upside progress although it is going to be volatile once the results begin to emerge and a neutral stance is best for now.sp

24 Hour:  Neutral

Medium Term: Neutral

DJI Futures 18129
Resistance Support
18364 22 Sept high 18050 Minor
18300 Descending trend resistance/ (61.8% of 18621/17798) 17982 Session low
18210 (50% pivot of) 17890 Minor
18185 100 DMA 17820 Chart Gap
18164 Session high 17755 200 DMA

Bias

Ditto S+P. Neutral. The dailies have turned higher after today’s spike and further gains do seem possible in the event of a Clinton victory.dji
24 Hour:  Neutral Medium Term: Neutral
ASX SPI 5247
Resistance Support
5315 (61.8% of 5435/5123)) 5240 200 HMA
5305 (50% of 5488/5123) 5220 Minor
5280 (50% pivot of 5435/5123) 5200 100 HMA
5261 (38.2% of 5488/5123) 5165 Session low
5254 Session high 5140 Chart Gap

Bias            

The ASX joined in the relief rally on Monday, gapping higher and then trading up to 5254, closing at session highs.  As elsewhere, a neutral stance is required but the daily momentum indicators do now hint that further gains could lie ahead, which a strong Clinton victory may well bring about.spi
24 Hour:  Neutral Medium Term: Neutral
GOLD 1281
Resistance Support
1315 100 DMA 1278 Session low/200 DMA
1308/06 2/3/4 Nov high 1271 31 Oct low
1302 Chart Gap 1262 25 Oct low/4 Oct low /28 Oct low
1296 Session high 1255 Minor
1283 200 HMA 1246 14 Oct low

Bias                              

Gold is lower after the need for a safe haven asset diminished following the FBI announcement and we are currently sitting just above the 200 DMA support. The charts are mixed suggesting that conditions will remain choppy and for the time being a neutral stance is required.gold
24 Hour:  Neutral Medium Term: Neutral
SILVER 18.21
Resistance Support
19.35 (76.4% of 20.06/17.10) 18.00 3 Nov low /Session low
19.10 (50% pivot of 21.13/17.10) 17.92 (50% pivot of 17.10/18.73)
18.92/95 (61.8% of 20.06/17.10)/100 DMA/200 WMA 17.75 (38.2% of 17.10/18.73)
18.73 2 Nov high 17.55 28 Oct low
18.47 4 Nov high 17.40 21 Oct low

Bias                                                                                                 

Ditto Gold. Silver is pretty much unchanged today and with the charts looking mixed it would seem that conditions will remain choppy. For the time being a neutral stance is requiredsilver
24 Hour:  Neutral Medium Term: Neutral
OIL (WTI) 44.90
Resistance Support
46.80 (38.2% of 52.19/43.55) 44.08 Session low
46.44 2 Nov high/100 DMA/100 WMA 43.40 200 DMA
45.88 3 Nov high           42.98 1 Sept low
45.58 (23.6% of 52.19/43.55) 42.20 (76.4% of 39.17/52.19)
44.96 Session high 41.75 Minor

Bias

WTI is higher today, having approached 45.00 and is closing near the highs. As with everything else, a neutral stance is required and it may be that we chop around here, with the OPEC arguments likely to hinder any major reversal of the downtrend. However the short term charts hint at the chance of a minor reverse head shoulder formation which could bring about a quick move to 46.50.wti
24 Hour:  Neutral Medium Term: Neutral

EURUSD: 1.1045
Resistance Support
1.1150 100 WMA/Weekly cloud top/Weekly Kijun 1.1028 (38.2% of 1.0850/1. 1138)
1.1138 4 Nov high /100 DMA/Chart Gap 1.0995 (50% pivot of 1.0850/1. 1138)
1.1109/15 Session high/Weekly cloud base 1.0960 (61.8% of 1.0850/1. 1138)
1.1085 100 HMA 1.0935 (76.4% of 1.0850/1. 1138)
1.1060 Minor 1.0880 Minor

Bias

The dollar is higher at the end of Monday trade, with the Euro under some pressure following the FBI intervention into the election campaign and a neutral stance is required until we get some clarification of the result. The daily charts still look positive for the Euro, and in the days ahead we could yet see the dollar come under pressure, particularly if it is a close result. In the short term, the 4 hourly charts do point lower so a test of 1.1000, and lower, could be on the cards but I would not want to be spending the next 24 hours too long of dollars. Expect it to be fairly volatile and if Trump looks as though he may spring a surprise we could see a quick reversal, with the Euro possibly retesting the 1.11/1.12 area. A dominant Clinton victory would most likely see a continuation of the relief rally until things settle down a little.

24 Hour:  Neutral

Medium Term: Neutral

Economic data highlights will include:

T: US Presidential Election, German Industrial Production, US NFIB Business Optimism Index, API Weekly Crude Oil Stock Inventory

Meta Trader – AxiTrader
EURUSD: 4 Hour

euro


USDJPY: 104.48
Resistance Support
104.80 (76.4% of 105.52/102.54) 104.00 Minor
104.62 Session high 103.76 Session low
105.00 Minor 103.20 Chart Gap
105.25 Minor 103.00 Minor
105.52 28 Oct high 102.80 (50% pivot of 100.05/105.52) /Daily Kijun /100 DMA /4 Nov low

Bias

US$Jpy was a major beneficiary of the FBI inspired turnaround in risk sentiment, and after having gapped higher at the Asian open it has not looked back. Risk reward does not really warrant any new speculative positioning and on the topside, heavy Japanese offers are rumoured to be lining up above 105.00. On the downside, a chart gap to 103.25 needs to be filled, although this looks unlikely right now.

24 Hour: Neutral

Medium Term: Neutral

Economic data highlights will include:

T: Provisional Coincident Index, Leading Economic Index, Machine Tool Orders (Sept)

Meta Trader – AxiTrader
USDJPY: 4 Hour

yen


GBPUSD: 1.2402
Resistance Support
1.2630 Minor 1.2378 Session low
1.2600 Minor 1.2335 Minor
1.2557 Friday high 1.2295 200 HMA
1.2505 Chart Gap 1.2275 (38.2% of 1821/1.2556)
1.2445 Minor 1.2190 (50% pivot of 1821/1.2556)

Bias                                                                                     

Sterling has sharply reversed the gains of last week, but while the 4 hour momentum indicators point lower the dailies remain positive, suggesting that we could yet see another turn to the topside in the days ahead. In the meantime, a neutral stance is required. Look out for the Manufacturing/Industrial Production and the NIESR GDP Estimate which may cause some short term volatility.

24 Hour:  Neutral

Medium Term: Neutral

Economic data highlights will include:       

Manufacturing/Industrial Production, NIESR GDP Estimate

Meta Trader – AxiTrader
GBPUSD: 4 Hour

gbp


USDCHF: 0.9739
Resistance Support
0.9875 (61.8% of 0.9999/0.9680) 0.9730 Session low
0.9840 (50% pivot of 0.9999/0.9680) 0.9695 Chart Gap
0.9800 (38.2% of 0.9999/0.9680) 0.9680 4 Nov low
0.9788 Session high 0.9650 (76.4% of 9538/0.9999)
0.9775 200 DMA/100 DMA 0.9630 26 Aug low

Bias                                                                             

US$Chf has headed a little higher, to sit near the convergence of the 100 DMA/200 DMAs at 0.9775. A neutral stance is required, although the daily charts do hint at the chance of further dollar weakness in the sessions ahead.

24 Hour:  Neutral

Medium Term: Neutral

Meta Trader – AxiTrader
USDCHF: 4 Hour

chf


AUDUSD: 0.7714
Resistance Support
0.7800 Minor 0.7680 Minor
0.7773 22 April high 0.7656 Session low
0.7756 10 Aug high 0.7640 200 HMA
0.7733 20 Oct 0.7612 2 Nov low
0.7718 Session high 0.7587/82 Daily Cloud top /31 Oct low

Bias

The Aud has squeezed back above 0.7700, to currently sit at session highs 0.7718, and the charts do seem to be aligning to point higher, possibly for a run towards decent resistance in the 0.7730/60 area. Overall a nimble stance is required ahead of the Election although the upcoming data (NAB Business Conditions/Confidence, China Trade Balance (Oct)) may cause some interim volatility.

24 Hour:  Neutral

Medium Term: Neutral

Economic data highlights will include:

T: NAB Business Conditions/Confidence, China Trade Balance (Oct)

Meta Trader – AxiTrader
AUDUSD: 4 Hour

aud


NZDUSD: 0.7324
Resistance Support
0.7413 9 Sept high 0.7292 Session low
0.7400 Minor 0.7277 4 Nov low
0.7380 (76.4% of 0.7485/0.7035) 0.7265 (23.6% of 0.7035/0.7337)
0.7368 22 Sept high 0.7220 (38.2% of 0.7035/0. 7337)
0.7344 Session high 0.7187 (50% of 0.7035/0. 7337)

Bias                                                   

The Kiwi has been rangebound ahead of the US election, with one eye also looking forward to Thursday’s RBNZ meeting at which a 25bp rate cut is expected. A neutral stance is required, but the daily momentum indicators point higher, and a Clinton victory would suggest that this could come about, for another look at 0.7400 and possibly even 0.7485.

24 Hour:  Neutral

Medium Term: Neutral

Meta Trader – AxiTrader
NZDUSD: 4 Hour

nzd