As the traders on Wall Street return to their yachts for a night of fireworks, their customers are left with a dour prospect on the return of the bears, as Asian markets continue to selloff. Combined with the US unemployment print on Friday, the mood is seeing USD weakening against the majors with gold rallying throughout the day. Chinese stocks are being pushed around by a weak Yuan that seems to be reversing after topping out above 6.72 recently against USD.
The Shanghai Composite pushed aside the previous meek rise to fall another 0.75% to 2765 points, remaining well below the previous level of support at 2800 and sealing the deal for continued downward pressure. The Hang Seng Index did even worse, falling 1.1% to be at 28226 points. While heavily oversold on the daily chart, theres no evidence here of an imminent uptick:
S&P futures are flat given the holiday tonight with the Eurostoxx futures down 0.2% or so, spelling some trouble ahead. I’m cautious on being bearish US stocks as the short term bottoming pattern developing here on the four hourly chart remains in play, if you keep the uncle point a little below the 2700 support level:
Japanese stocks are again just holding on with the TOPIX flat while the Nikkei 225 closed 0.3% lower to 21717 points, below daily ATR support at the 22000 point level as Yen continues to strengthen. The USDJPY pair is bouncing down to the 110 handle and bouncing off ATR trailing support signalling a dip only for now:
Bad news is finally catching up to the ASX200 with the local market taking back the previous session gains, falling 0.4% to be back below 6200 points, closing at 6183. The Aussie dollar is surprising on the upside, lifting up to the 74 handle at trailing ATR resistance as USD weakens, matching the Friday night high:
The data calendar is dead quiet tonight with the US holiday.