See the latest Australian dollar analysis here:
Dead cat’s are bouncing everywhere as tensions between China and US ramp up again, with The Middle Kingdom complaining about the “little tricks”, sending Chinese stocks down and futures cratering for tonight’s open and close to the week. The upcoming federal election in Australia hasn’t dampened the risk appetite locally, helped along by a much lower Australian dollar.
The Shanghai Composite is falling sharply going into the close, currently down 1.5% to 2912 points while in Hong Kong, the Hang Seng Index is not doing much better, down 0.7%% or so to 28056 points and exhibiting the first of the dead cat bounce rollovers on the daily chartS:
US and Eurostoxx futures are falling back in the wake of the Chinese risk off trigger as the four hourly S&P500 chart shows an inability to close at a new weekly high, hovering well below the 2900 point level:
Japanese share markets are the standout, with the Nikkei 225 up 1% to 21278 points despite a reversal in Yen weakness. The USDJPY pair has rejected overhead resistance at the 110 handle and fallen back below its own high moving average on the four hourly chart after a breakout to the upside in the last 24 hours – not a good signal:
Australian stocks have done well despite all the noise plus the looming election with the ASX200 lifting another 0.7% to be at 6370 points going into the close. This is all really due to the Australian dollar which remains on a nice downtrend falling again to another new low and looking like finishing the week in the high 68’s:
The economic calendar finishes the week with the final EZ wide CPI figures for April plus the University of Michigan sentiment survey in the US.
Have a good weekend!