by Chris Becker
Outside Australia its not been a good start to the week for Asian stocks, with Japanese and Chinese bourses selling off in response to a turgid weekend of macro events and news. The PBOC fix of the Yuan, the huge gap down in Pound Sterling caused another safe haven run Yen as USD buyers were thin on the ground. Gold is up alongside oil on a similar bent.
The Shanghai Composite sold off immediately, down nearly 1.5% to 3066 points as it heads straight down to terminal support at 3000. The Hang Seng is following along, down 1% exactly as it breaks its recent swing/uptrend from the Xmas lows. I’m watching the low moving average on the daily chart to come under threat here:
Stocks are broadly negative in Japan with the Nikkei retreating nearly 1%, down back to 19124 points. The USDJPY is the culprit again as it remains on its downtrend through to the 114 handle. I’m watching the Thursday low here at the 114 level proper to come under stress tonight in the European session:
S&P Futures are flat and while nominally bullish – opening above the recent downtrend line – ATR rolling support is very closeby at 2265 points. Trump’s weekend comments may add some volatility (how many times will I have to repeat that phrase!) going into the London open:
The ASX200 is in a bubble of its own, rising 0.5% for the day back up to 5748 points, up mainly due to BHP which made a new monthly high,rising 1.7% to almost hit $27 per share. Gold miner Newcrest is up 2% on the back of the surging gold price, now above $1200USD per ounce.
The Aussie dollar is hanging in there against USD, slowly fading during the Asian session and possibly retracing its recent move as it heads below the 74.50 level. This pullback is to be expected as the currency went too high too fast recently:
The data calendar tonight is relatively quiet with UK house prices and not much else officially, but keep an eye on the newswires for talk and further rumors about Brexit as Theresa May gears up for her big “hard” Brexit speech tomorrow night.