The trade: US Tech 100 rebounds as Australia 200 holds firm
IG's Tony Sycamore analyses the US Tech 100 and ASX 200 as markets react to earnings and eased US-China trade tensions.
(AI video summary)
This video was created on 23 April for IG audiences by ausbiz.
US Tech 100 rebounds with caution
The United States (US) Tech 100 saw a significant rebound as earnings reports and eased US-China tensions encouraged buying. The rally extended after President Trump stated he would not fire Federal Reserve (Fed) Chair Jerome Powell.
However, the technical outlook is still unclear. The recent decline shows a three-wave corrective pattern in Elliott wave terms. Sycamore notes, 'Whether this rally marks a short squeeze or the start of a new bull market remains uncertain. Breaking significant upside levels, particularly the 200-day moving average (MA), is essential to confirm a low and resume the uptrend.'
Until key technical levels are breached, expect volatility. Upcoming earnings may offer market support in the short term.
Australia 200 and AUD signal stability
The Australia 200 shows a more favourable technical picture. The decline from its Valentine's Day high was orderly, and the index has stabilised above critical resistance around the 7800 to 7850 range.
Sycamore expects it to trade sideways between 8000 and 8200 until year-end, indicating stability amidst uncertainty.
The Australian dollar shows a well-defined V-shaped bottom at the $0.5914 level. If it breaks above the 200-day MA near $0.6475, it could confirm a medium-term bottom, attracting institutional interest.
Bitcoin shows potential as gold retreats
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Gold
Gold touched $3510 before retracing as risk appetite returned. This pullback suggests a normal correction after an extreme rise. Investors may find better entry points in future sessions.
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Bitcoin
Bitcoin has broken above its 200-day MA, showing strength. 'There's a lot of good signs for Bitcoin,' Sycamore explains. If Bitcoin holds above $74,000, it could retest the 109,000 high and potentially reach 120,000 to 125,000 if momentum continues.
Bitcoin's technical setup looks strong amid broader uncertainty, with potential for further gains following its recent breakout.
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