By Chris Becker
A very quiet day on Asian markets with not much data to respond too or central banks to front run with any “puts”. The ASX200 eventually closed in the green – just – up 3 points to 4486 – I’ll take a closer look at the bottom of the post including technical analysis of the bourse.
The Nikkei 225 slipped down – interestingly the correlations between major bourses are breaking down, which is great for us traders since the volatility has been seemingly taken off the table, at least for major trends. The Hang Seng finally had a sizeable day , up 0.5%, while the Shanghai Composite had a scratch day. Interestingly too, the correlation between the Chinese bourses is not exact either – you need to drill down a bit further than composites.
Aussie bond yields remained steady, hovering around 3%, with the Aussie battler (AUD/USD) continuing to bounce off support at 1.015 and approaching its 200 day moving average – paraphrasing the best analyst on Wall Street, Admiral Akbar, “is this a trap?”
The Euro/USD surged half a percent today while the US Dollar (DXY Index) slipped, staying below 80 points.
Gold (USD) continues to be rangebound between heavy resistance overhead at $1800USD and support at $1750USD per ounce:
Australian Stocks
Materials came back today, mainly because of the “twins” RIO and BHP while the banks traded places.
As for the bourse itself, heres the daily chart – we’re still on trend here but I’m getting concerned at the sideways action – no move in prices in 6 sessions now – I’m watching the 4400 point level as closely as I’m watching the 1420 point level on the S&P500.
Hedging against volatility is super cheap at the moment – check out the Aussie version of the VIX – at five year lows!
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Chris Becker is an investment strategist at Macro Investor, Australia’s leading independent investment newsletter covering stocks, trades, property and fixed interest. A free 21-day trial is available at the site.
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