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Global Market Outlook:
Asian Markets Trade Mixed Influenced By Earnings
Equity Futures: Dow +9.00. S&P +1.80. NASDAQ +3.25. Japanese Nikkei +15.00. German Dax +12.00
Influenced by the earnings results, Asian markets are trading mixed. The heavyweight indexes; Nikkei and Hang Seng are trading slightly above the break-even line, but Australia’s S&P/Asx and South Korea’s Kospi fell approximately 0.50%. Thailand’s SET index gained almost 2%, after it plunged 4% in Thursday’s trade as news emerged that Thailand’s King might be sick.
During the Asian session, the S&P futures traded flat, consolidating near the 1090 swing area. To the upside, the next major resistance is in the 1115 area, where the market created a swing point low in early October 2008.
S&P Futures Technical View: TheLFB Member Charts
4 Hour chart trend: Long. Main price points: 1062.50, and 1115. Looking for: Wave 5)
S&P futures have broken through the 1075.25 highs from September, which puts the red wave C in play. Traders may be looking for a final push of a blue wave 5) before an expanding diagonal will then be completed. The target of the current move is shown between the 1095 and 1115 region, where traders may be looking for the temporary top of a bull market.
That is the technical view, and plots a good course to follow. As earnings season unfolds we are very much aware that the fundamental releases will dominate the direction of trade each day.
Sector Moves: The biggest drag on the market came from the technology and banking shares, the same two sectors that saw strong negative momentum during the prior U.S. trading hours. The financial shares plunged after Goldman Sachs and Citigroup disappointed the market, while technology stocks fell as Nokia posted very poor results in the third quarter. To further extend the negative momentum seen in the technology stocks, during the Asian session, LG Electronics also missed analysts’ estimations.
On the other hand, the defensive utility shares advanced in Friday trade, helping some markets stay above the break-even line.
Economic Moves: Clear
Crude oil for November delivery was recently trading at $77.90 per barrel, up by $0.30. Crude oil came to a virtual standstill during the Asian session, after it posted very strong gains during the prior U.S. session. Right now, oil is trading above the $78.00 area, near the highest value touched in a year.
Gold for November delivery was recently trading down by $2.40 to $1,048.20. Despite the gain seen in the crude market over the last few trading sessions, gold plunged at a noticeable pace. For now, gold is consolidating just above $1045 area, which seems to be an important 4-hour swing point.
Gold Technical View: TheLFB Member Charts
Daily chart trend: Long. Main price points: 1070. Looking for: Wave 3) top
On a daily gold chart, the market reached a new top recently around $1070 per ounce, where an extended red wave 3) should be completed soon. The market is currently trading around a significant Fibonacci extension resistance area, where a move lower into the corrective wave 4) may follow over the coming days and weeks, towards the $1000 support zone. The stochastic oscillator also signals for a move lower after the bearish cross in the over-bought area.
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