Asian stocks have been prey to sheer volatility ahead of the US inflation data. (Pivot Orderbook analysis)

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• Asian stocks have been prey to sheer volatility ahead of the US inflation data.
• Massive sell-off at Facebook’s helm brought a sell-off in S&P500.
• Long-term US yields have tumbled in anticipation of a 50 bps rate hike in the December policy meeting.

The pair currently trades last at 27526.2.

The previous day high was 27805.8 while the previous day low was 27521.49. The daily 38.2% Fib levels comes at 27630.1, expected to provide resistance. Similarly, the daily 61.8% fib level is at 27697.19, expected to provide resistance.

Markets in the Asian domain have witnessed an intense sell-off after fetching negative cues from S&P500. A significant recovery in the risk-off market mood has forced investors to stay away from equities till the release of the US Consumer Price Index (CPI) and the outcome of mid-elections outcome.

At the press time, Japan’s Nikkei225 tumbled 1.05%, ChinaA50 dropped 0.43%, Hang Seng plummeted 1.87%, and Nifty50 surrendered 0.70%.

Massive lay-off announced at Facebook dented sentiment of market participants. This has triggered the risk of a slowdown in overall demand. Well, US equities are facing the consequences of accelerating interest rates by the Federal Reserve (Fed). Also, a majority win of Republicans would snap some command from Democratic in passing bills and laws.

The US dollar index (DXY) is hovering around the day’s low at 110.20 as investors are restricting themselves ahead of the US CPI for making informed decisions. The 10-year US Treasury yields have tumbled to 4.07% as odds are not favoring a rate hike of 50 basis points (bps) in December monetary policy by the Federal Reserve (Fed). Going forward, the extent of deviation in inflationary pressure will provide meaningful cues about the likely monetary policy action by the Fed.

Meanwhile, Nikkei225 has witnessed selling pressure despite the announcement of economic stimulus packages this week. To spurt the aggregate demand, the Japanese administration has decided to provide stimulus budgets and hike taxes for big pockets.

On the oil front, oil prices have nosedived by more than 3% after the head of the International Energy Agency (IEA) Fatih Birol slammed OPEC+’s decision to cut oil production as it might worsen the outlook for developing countries that are sliding towards recession, reported Bloomberg. He further added that the move is fueling inflation, especially in developing countries, and may require a “rethink,”

Technical Levels: Supports and Resistances

XTIUSD currently trading at 27526.2 at the time of writing. Pair opened at 27526.2 and is trading with a change of 0.0 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 27303.68, 50 SMA 27284.17, 100 SMA @ 27403.91 and 200 SMA @ 27146.81.

The previous day high was 27805.8 while the previous day low was 27521.49. The daily 38.2% Fib levels comes at 27630.1, expected to provide resistance. Similarly, the daily 61.8% fib level is at 27697.19, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 27429.86, 27333.52, 27145.55
• Pivot resistance is noted at 27714.17, 27902.14, 27998.48

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