Macro Afternoon

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by Chris Becker

Asia is having a relatively quiet day as traders position for the closely watched NFP print in the US tonight. Most stock markets closed slightly higher, with the ASX rebounding after a poor week of performance, mainly due to an Aussie dollar that has cracked and likely to head to 77 cents very quickly against King Dollar.

In mainland China the Shanghai Composite remains closed with the Hong Kong based Hang Seng Index popping back to put in a few points before the weekend. It lifted only 0.2% to close at 28429 points, to be just above local resistance at the 28000 point level as momentum remains overstretched:

S&P futures are steady and poised here waiting for clearer inflationary signals from tonights unemployment print. It remains BTFD all the way:

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Japanese stocks had a slightly better session as the Yen weakened slightly against USD. The Nikkei finished up 0.3% higher at 20690 points, still clinging above resistance at the 20,000 mark. The USDJPY pair is slowly pushing higher, breaking out to the upside from its stuck moving average band. The level to watch overhead is 113.10 or so (the black horizontal line):

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The ASX200 rebounded in a very solid session to finish the week below the 200 day moving average, following the US lead by rising 0.9% to finish at 5710 points. The banks lead the way with a wave of short covering, with CBA and WBC both up 1.3% while BHP put on nearly 2%.

Aussie dollar has cracked here as expected, falling below the 78 handle proper after big pressure last night:

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This takes it back to its previous long held resistance level as seen on the weekly chart below and will have investment houses frantically re-writing their forecasts for the rest of the year:

The data calendar finishes the week with the biggest event, US unemployment or non-farm payroll (NFP). But there’s also Canadian unemployment data, plus a private oil rig count.

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