by Chris Becker
Its a very mixed day in Asia following a solid bounce on risk markets overnight, as markets absorb the volatility surrounding the ongoing speculation about the future direction and magnitude of interest rate rises from the US Federal Reserve. Japanese stocks are solid as Yen sells off slightly, paring some of the losses on the USDJPY overnight. The pair needs to gain traction above the 102 handle here soon or the Nikkei – currently up 0.4% – will rollover soon:
Chinese stocks are absorbing their own catalysts with the August industrial production and retail sales prints coming in better than expected. The Shanghai Composite is down a quarter of a percent to 3014 points going into the close, just holding onto critical support while the Hang Seng is up nearly 1% in contrast.
The ASX200 jumped at the open, up over 1% but has pissed away all these gains, now down 0.2% going into the close showing this is just short covering with no conviction to hold onto meaningful long positions. Stand aside here!
Turning to commodities I’m watching silver and gold closely with the former unable to make a new intrasession high since the start of the week. This is usually bad news for the precious metals:
The hourly chart of gold going into the London fix shows its needs to crossover the rolling ATR resistance level at $1330USD per ounce to have any chance of rebounding. There has been a small bounce for the brave during the Asian session that is looking to rollover already:
Meanwhile in currencies, the same can be said about the Aussie dollar which after rebounding slightly overnight is being sold off against the USD and indeed on the crosses (especially Yen). The 75 handle needs to hold here or whoosh, down to 74 we go:
The data calendar rolls on tonight with the UK August CPI print that could take the sails out of Pound Sterling, followed by the Euro-wide ZEW sentiment survey. State-side its relatively quiet but watch out for any rumination from Fed officials coming into next weeks FOMC meeting.