by Chris Becker
Asia remains cautious in the face of seemingly intractable domestic policy development in the US, although Yen sold off providing a tailwind for Japanese stocks, Chinese bourses are under pressure from monetary policy tightening internally. Crude oil and other commodity prices remained depressed with the Australian dollar still weakening against the USD.
The Shanghai Composite is rallying after the long lunch break after a scratch start to the session, now up 0.75% to 3252 points. This is looking good coming into next week as it attempts to climb above local support at the 3200 level. The Hang Seng Index closed down a few points, but again only just in scratch territory at 24314 remaining just above recent resistance. The high moving average is still being respected here but watch the momentum reading below carefully for a swing short position:
Japanese stocks rebounded as the Yen sold off against USD with the Nikkei up nearly one percent to close at 19262 points. This takes it out of the danger zone building on the daily chart as Yen sells off it is providing a possible long breakout play on the USDJPY hourly and four hourly timetables. The former chart below shows how it is dicing with resistance at the 111.50 level:
S&P futures are steady and still respecting their tentative uptrend from the dip lows here:
The ASX200 had another positive session, closing up 0.8% to build on yesterdays moves, now at 5753 points, almost entirely due to financials rallying as the last divisions of Megabanks jack up interest rates.
The Aussie dollar tried to rally on the Sydney open, but was swiftly sold off during the session, almost breaking below the 76 handle against USD. This slow meltdown will continue for mind as the daily chart builds negative momentum:
The data calendar ends the week with some preliminary services PMI’s from Europe, but further on its the US durable goods order for February for Fed watchers and the Baker Hughes oil rig count number for oil traders.