Monday saw a shaky day once again for futures, popping up on FED QE Infinity, then down at the cash open, while Senate wasn’t able to pass the Fiscal stimulus bill, even if Mnuchin (US Secretary of the Treasury) was assuring that the agreement was very close at CNBC.

  • Asian equities in green overnight: ASX +2.4%, Nikkei +4.7%. JAPANESE INDEX IS SHOWING SOME SERIOUS STRENGTH LATELY.
  • USD Index down to 102.00 at three-day lows and EurUsd catching again the 1.08 mark.
  • BoJo locks down the UK for 3 weeks.
  • Manufacturing, Services and Composite PMI (Purchasing Managers’ Indexes) in Europe and the UK (in the afternoon in the US): I think it will be the first taste of the business sentiment amid the ongoing crisis, eventually even the low consensus in EU (37 to 41) could be too optimistic.

YESTERDAY: FED ALL IN

Just to recap, as this is a very important action, the FED will:

  • Do UNLIMITED QU for avoiding the USD funding market to freeze
  • Buy an unlimited amount of Treasury Bonds and MBS (Mortgage Backed Securities)
  • Buy up to 300 Billions $ in corporate bonds
  • Buy municipal bonds
  • Preparing the main street business lending programme for SME.

Just a chart today: NASDAQ

Ok, this is a reprise of we sent out in our weekly outlook, intending to be optimistic about the price action of equities markets.

WEEKLY CHART: NASDAQ

On a long-term time-frame, Nasdaq is – for now – rebounding very well on the long-term trend since 2016 and not breaching the 200 SMA – (what we showed on WO).

1-hr CHART NASDAQ  

Been trying to build a bottom around 7020 since 12-03 with a lower open yesterday morning, immediately bought. Price action is trying to break down-trendlines; I think NDQ will be trading between 7000 (that could be retested even soon, now 7300) and 7650 (yes, it’s a 10% range, but you’ve seen with which volatility we are dealing). 

Only a clear break of that area could bring to the 7950 – 8150 area, that will be a BIG RESISTANCE. Anyway, even if we could get so high again -and now is too early for thinking about it- I believe that trading above 8500 enters in the field of sci-fi.


By: Marco Turatti

Technical Analyst

TIO Staff
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