The XJO is expected to open flat once again this morning following another night of indecisive trading from the U.S last night that saw their market finish slightly lower. Their futures have edged into the green this morning.
Our market has followed suit, albeit without the intraday volatility. Very little movement has happened this week, and today is expected to be no different.
7,150 to 7,200 is the next clear support, with 7,100 being the next clear target if they fail. 7,300 to 7,350 remains clear resistance with 7,400 the next clear target if we push through. We are roughly trading in the middle of the range, with little indication as to the next move.
US Markets
US shares closed mostly lower overnight, with the DOW JONES and SP500 finishing in the red, whilst the NASDAQ managed a small gain. US markets were spooked somewhat by worse than expected jobless claims, which rose to their highest level since 2021. There was also concern that bank PacWest might follow similar banks and collapse in the coming period. Finally, the US government debt ceiling issue is yet to be resolved and could trigger additional volatility in markets as June approaches. In general, there is not a whole lot for US markets to be happy about at the moment, so the fact they remain near their highs is a strong sign of resilience.
Three of the eleven sector groups of the SP500 closed higher overnight, with only Communications managing a notable gain. Energy stocks were again the weakest performers, followed by Utilities, Real Estate, and Materials stocks.
The SP500 has been largely unchanged for the past four sessions and it remains in a bit of no man’s land, above the 4,050 as a support level from last week last week, but below the 4,170-resistance level. Its not at all clear which way the market wants to break, but should the 4,170 level break, the next upside target is very close by at the 4,200 resistance level. Should 4,050 break to the downside, the next target would be the 4,000 point level.
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Sam Green is the Portfolio Manager at Emerald Financial, whilst also being an Equities and Derivatives expert for his clients at TradersCircle.
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