Despite a good lead from Wall Street on Friday night, continued confusion and dismay surrounding Trump’s trade war has seen stocks fall across Asia today. Adding to the volatility are the Italian polls, with a hung parliament full of populists and nationalists, although Angela Merkel finally resolved Germany’s governance problem with a new coalition.
The Shanghai Composite is down 0.2% going into the close, currently at 3248 points, still unable to crack above key resistance at 3300 as the sellers step in again. The Hang Seng Index is off considerably more, closing down 1.3% to 30187 points, extremely close to key support at 30000 as negative momentum builds on the daily chart:
S&P futures have retraced half of Friday night’s gains signalling a retracement back below the key 2700 point support level:
Japanese stocks fell despite a slightly weaker Yen with the Nikkei 225 losing just over 0.6% to be at 21046 points, almost back to its first correction low. The USDJPY pair is holding on below the 106 handle after a small gap lower this morning was filled, but the tiny triangle here on the four hourly chart is pointing to a breakdown below the 105.50 level:
The ASX200 did the best in the region by not falling as much as others, closing 0.5% or 33 points lower to 5895 points, remaining well below the psychologically important 6000 point level and setting up for accelerate falls as it goes below the 200 day moving average and 5900 points proper. The Aussie dollar is flat as a pancake, steady at the mid 77s with the weight of last week’s selling bearing down here. I’m watching the 77 handle tonight for signs of another breakdown:
The economic calendar starts the week with some services PMI prints in the UK, followed by the non-manufacturing/services composite ISM release in the US overnight.