By Deepta Bolaky
 @DeeptaGOMarkets

Equity Markets

Global equities were driven by optimistic tones around the intentions of securing a coronavirus relief package before the US election day. The momentum in European markets was overshadowed by the second wave of coronavirus cases across Europe.

Source: Bloomberg

Wall Street rallied lifted by the outperformance of the mega US tech companies ahead of the third-quarter earnings season.

Major US equity indices closed around 1% or higher on Monday:

• The Dow Jones Industrial Average added 251 points or 0.9% to 28,838.
• S&P 500 rose by 57 points or 1.6% to 3,534.
• Nasdaq Composite added 296 points or 2.6% to 11,876.

Adam Taylor takes a look at the Australian markets using the Point and Figure analysis:

Talk of a potentially aggressive stimulus package has helped boost the ASX200 as it looks to extend its recovery from the March lows. Using the point and figure method, we’ll be looking to highlight potential pockets of supply and demand levels to monitor during the upcoming sessions.

What initially sparked the interest in today’s chart is the emergence of a bullish flag chart pattern, as shown in the chart above. While the low of 5738 forms the base, it has also collided with the current bullish support line suggesting the uptrend remains healthy and intact.

The upper-part of this flag pattern at 6100 looks set to form a triple-top while waiting for that all-important breakout to the upside. If this should occur, 6410 is the next upside target where demand may find resistance, followed by the recent high of 7082.

A breakout to the downside past 5738 would violate the overall trend at paint a more bearish scenario. The level of 5480 where the previous surge in demand took place could end up providing support for the index and slow supply.

Fundamentally, we would perhaps need a further downgrade of trade negotiations between Australia and China to take place or even just a sudden pull of the global markets in general to spark a sell-off. Still, for the time being, the chart outlook appears quite bullish.

Currency Markets 

In the FX space, major currencies traded mixed against the US dollar as risk sentiment improved on Monday on the hopes of a US stimulus package.

Source: Bloomberg

Amid a relatively muted economic calendar, the price action in the currency markets revolved mostly around geopolitics. Commodity-linked currencies were among the worst performers.

Commodities

Despite the improvement in risk sentiment, crude oil prices failed to lift higher as the energy markets remain underpinned by much uncertainty on the demand outlook. As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading around $39.55 and $41.72 respectively. Besides the usual weekly oil reports, traders are to keep an eye on the following events for fresh trading impetus:

1. Tuesday: World Energy Outlook 2020
2. Wednesday: Oil Market Report October 2020

Gold

Last week, the precious metal caught a breather on a weaker US dollar and the latest update on the US stimulus package. The XAUUSD pair has consolidated around the $1,925 level in anticipation of more concrete information on the US stimulus package.

Source: GO MT4

By Deepta Bolaky
 @DeeptaGOMarkets

Key upcoming events

• Current Account (Japan)
• Unemployment Rate and SNB’s Chairman Jordan speech (Switzerland)
• Trade Balance (Germany)
• ECB’s Mersch Speech and Monetary Policy Meeting Accounts (Eurozone)
• Jobless Claims (US)
• BoC’s Governor Macklem Speech (Canada)

Wednesday, 14 October 2020  Indicative Index Dividends Dividends are in Points
ASX200	WS30	US500	US2000	NDX100	CAC40	STOXX50
0.118	0	0.401	0.142	0	0	0
ESP35	ITA40	FTSE100	DAX30	HK50	JP225	INDIA50
0	0	0	0	5.314	0	2.925

Disclaimer:  The articles are from GO Markets analysts,  based on their independent analysis or personal experiences. Views or opinions or trading styles expressed are of their own;  should not be taken as either representative of or shared by GO Markets.  Advice (if any),  are of a ‘general’ nature and not based on your personal objectives, financial situation or needs.  You should therefore consider how appropriate the advice (if any) is to your objectives, financial situation and needs, before acting on the advice.  If the advice relates to acquiring a particular financial product, you should obtain and consider the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) for that product before making any decisions.

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