THE LONDON OPENING 15-06-2022
EU STOCKS ATTEMPT A REBOUND AHEAD OF THE FED MEETING; THE ECB WILL HOLD AN EXTRAORDINARY MEETING TODAY TO DISCUSS THE RECENT SELL-OFF IN GOVERNMENT BONDS
Eu stocks are trying a rebound this Wednesday ahead of one of the recent most important FED meetings. Investors have raised their bets that the FED will increase the interest rates by 75 bps; according to the CME’s Fedwatch Tool, the probability for a 75-bps rate hike jumped by more than 80% in a week, and it is now at 89%. If confirmed, this one will be the highest interest rate hike since 1994.
According to Reuters, the ECB scheduled an extraordinary meeting to discuss the recent sell-off in the government bond market. Yesterday, the 10-year German Bund yield rose to 1.77% while its Italian counterpart was 240 points higher, the largest spread in 2 years.
Regarding the macroeconomic calendar, apart from the FED meeting scheduled for this evening, US Core Retail Sales, Retail Sales and Crude Oil Inventories are due to be released today.
EURUSD, M15
The EURUSD is rising this morning following the announcement of an extraordinary meeting by the ECB. They will discuss possible interventions to tackle the recent sell-off in the government bond market. From a technical point of view, it is currently trading above the weekly Value Area, which can be considered a positive bias for today. However, if it fails to consolidate above the 1.0494 mark, the recent rebound could have been triggered by the ECB announcement only, and the Euro will soon fall back into the Value Area. At the moment, the most likely scenario is a retracement to the current weekly VAH. Then, if prices drop back into the Value Area, the lower support for today are the current weekly POC and the current VAL. Conversely, as soon prices remain above the Value Area and eventually break the 1.05 mark, a quick stretch to target higher resistance areas is expected.
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: 1.0460, 1.0441, 1.0413.
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: 1.0494, 1.0530, 1.0580.
WTI, M15
The WTI is trading at the lower part of the current weekly Value Area ahead of the Crude Oil Inventories data to be released today. From a technical point of view, the most important intraday resistance is the 116.5 mark, which is the W-1 VAL. As prices remain below this main resistance area, they could target the current weekly VAL and the LVN around 114.80 in extension. Particular attention should be paid to the latter area because if prices fall below that support, a quick move until the 113.20 mark is expected. On the other hand, if prices break the main resistance upward, the WTI could try to regain a part of the last 4-days losses.
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: 116, 115.3, 114.8, 113.20.
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: 116.5, 119.
