By Chris Becker
Big breakouts in currency land overnight while US stocks didn’t move much as the ECB downgraded its inflation outlook and adopted an even more dovish tone in its meeting last night. US Treasuries rallied hard and everyone dumped USD as a result, with gold and Yen launching to new highs, pulling the Aussie dollar above 80 cents. This should be supportive for risk-on assets but the currency appreciation will provide headwinds for stocks.
Recapping Asia yesterday the Shanghai Composite finally couldn’t finish its current run trying to reach up to 3400 points by dropping almost 0.4% to 3373 points, breaking a five day deadlock. The daily chart continues to show a lot of congestion here at just below 3400 which is looking more and more like a big stretch:
