by Chris Becker
Its going to be an interesting year thats for sure, with Chinese stock markets pummeled yesterday and huge volatility around the Iranian/Saudi diplomatic spit, plus a less than exciting ISM print in the US overnight, all boiling down to a significant loss of confidence in risk markets. Stocks were hammered, down 2-3% on both sides of the Atlantic, while a rush to safety to government bonds as commodities also boiled in a steaming pot. Gold was the standout, rising over 1% while Dr Copper was Shanghaied, down 2.5% as oil oscillated wildly.
Recapping Asia’s strange day and as I reported earlier, the Shanghai Composite was slammed, losing 7% before trading was halted. As I mentioned in yesterday’s report “although the weekly chart shows a rising series of higher lows, the inability to gain traction is telling, so I’m watching the break of (the 3500 point) trendline in the week(s) ahead and back down to support at 3000 points”. Didn’t have to wait long…Terminal support at 3000 points is key here- if that’s broken, think 2000 points real quickly:
