By Chris Becker
A busy day on risk markets! With the US Dollar crumbling, undollar assets are rallying as the Euro session gets underway. Today in Asia, the ASX200 barely finished in the green, up only 8 points to 4333 – I’ll take a closer look at the bottom of the post including technical analysis of the bourse itself to explain what I’m going on about…
It was fairly modest gains elsewhere in other non-Chinese markets too, the Nikkei 225 having a scratch day absorbing some interesting GDP revisions, with the Hang Seng doing the same. The Shanghai Composite was up 0.3%, the other mainland markets up nearly 1% each, with peripheral bourses all mixed. Not quite the start to a “risk on” move, and as Euro bourses open, its a sea of red – but only very light losses..
The Aussie battler (AUD/USD) is coming back, although in the last two sessions it has stalled at 1.04:
The Euro/USD is doing better, holding up after the handle gain on Friday, now just below 1.28, as the US Dollar Index remains firmly below the 81 point key level. Meanwhile, Queen Undollar – gold (USD) – is holding onto her Friday gains (over $35!) and remains at $1735USD per ounce.
Australian Stocks
Its been an interesting day on the Aussie bourse, to say the least – as you can see in the table above, it was the miners that benefited, with the top in the ASX8 (the top four banks and miners) being Newcrest (NCM) – up over 4% for the day. The real mover was of course Fortescue Metals (FMG) – up 7% for the day and over 26% from its bottom. Sadly, I’m no longer short – neither is Macro Investor – although we booked a very solid gain on that one…
Here’s the daily chart of the index, showing the fairly muted gains today, but still on trend and above support, 50 and 200 day moving averages. If we surpass the 4400 point barrier overhead (a tall order) its a new cyclical bull market – I still think there are better gains to be had elsewhere (as my Trades’ subscribers know at MI):
These daily updates need to be placed in context with the longer trends and drivers amidst the overall technical picture, where Former “Trading Week” readers will find it reborn as “Technicals“, published 8.30am each Monday morning.
Chris Becker is an investment strategist at Macro Investor, Australia’s leading independent investment newsletter covering stocks, trades, property and fixed interest. Each week Macro Investor publishes tables on the top ten most undervalued and overvalued stocks on the ASX. A free 21-day trial is available at the site.
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