Macro Afternoon

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Its looking more and more like risk-off as Asian markets retreat in line with US markets overnight, the possible breakdown of talks on the Korean peninsula and the US growing trade war with China the likely catalysts.

The Shanghai Composite slumped after a minor pulback below strong overhead resistance at 3200 yesterday, falling over 1.4% to closed at 3168 points. The Hang Seng Index reopened from a holiday and immediately sold off, losing 1.5% to 30762 points. This takes it back to its former session lows with the low moving average on the daily chart at 30600 the key support line that must hold:

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S&P futures are retreating as are EuroStoxx futures as the risk off mood widens – look at that lovely bearish rising wedge pattern here on the four hourly (and daily) chart:

The rising Yen is causing a selloff in Japanese stocks with the Nikkei 225 falling back about 1.2% to be well below 23000 points, closing at 22689. The USDJPY pair has broken down convincingly here after making a series of session lows, falling right through its low moving average and the trailing ATR support to be just above the 110 handle going into the European open:

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The ASX200 was actually the best in the region, but still confirming its double bearish top on the daily charts, falling 0.2% to 6032 points with key support at 6000 the likely next target. The Aussie dollar has rolled over and taken back most of its previous breakout gains, back to the low 75s against USD. The next level is the 75 handle at ATR support on the four hourly chart:

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The economic calendar is UK and Euro centric with the former having its monthly CPI print and the latter some manufacturing PMIs as we await the FOMC minutes to be released stateside.