by Chris Becker
A simple story of a higher USD pushing the other majors down while stocks in Asia absorbed the weekend events without much fuss.
The Shanghai Composite is the best performer, up over 1.2% at 3120 points, now going into the close with the Hang Seng up only around 0.4% or so. Both are making good gains above their 3000 and 23000 point support levels respectively, with a Christmas rally at hand.
In Japan, the Nikkei is melting up slightly, as the Yen weakened on the Monday Morning Gap but is strengthening in the afternoon. The Nikkei broke out last week above daily ATR resistance and is still looking well overbought here, so a retracement to 17000 points is to be considered, unless the overnight leads turn more positive.
S&P Futures are up slightly, while the FTSE looks to open at least 0.3% higher. The daily chart of the S&P500 needs some more momentum from here, I’m watching the high moving average at 2143 points for a breakout:
The USDJPY pair is hovering around the 104 handle, this level corresponding with the point of control that broke earlier last week. This pair needs to get back above 104.40 to help the Nikkei further and the four hourly chart shows no direction so far:
For the ASX200, it was a poor start to the week, closing down 0.4% to 5408 with Healthscope still falling – down 6% again today – from its downgrade on Friday, alongside Coca Cola Amatil (CCA) which analysts are dumping left right and centre on concern of its AUD affected earnings. Not a good look for the ASX200, which is only 20 points or so off terminal support on the daily chart:
Price action in the Aussie dollar was nonplussed on the Monday gap, with a wobble around lunchtime before settling higher for the Asian session at 76.15 or so. The downtrend on the hourly chart below needs to be cleared for any swing price action to have momentum:
The data calendar tonight includes a slew of preliminary manufacturing PMIs from Germany, the EZ and the US and not much else to start the week.