See the latest Australian dollar analysis here:
Asian markets are not responding well to the weekend news, with non-mainland Chinese stock markets selling off broadly. Korean stocks are down more than 3% while local stocks are off 2%, as the fear surrounding the coronavirus from China spreads. Gold and other currencies gapped wildly on the Monday morning open with the shiny metal up another $20USD per ounce in what looks like a blowoff safe haven FOMO trade.
The Shanghai Composite is just hanging on, down a handful of points to be at 3036 while the Hang Seng Index is down 1.4% to 26902 points as it wipes out any short term support and looks set to re-kill this dead cat bounce:
Japanese share markets are closed for yet another holiday while the USDJPY pair gapped lower alongside other risk assets, almost breaking the 111 level before recovering the mid 111 area but still looking very weak here:
The ASX200 closed a whopping 2.2% lower at 6978 points, wiping out the 7000 barrier and all of February’s gains. The Australian dollar gapped significantly lower after its big blip higher on Friday night, and has barely recovered to just float above the 66 handle as it hovers at another year low :
Eurostoxx and S&P futures are dropping fast with the dour mood here in Asia, as the four hourly chart of the S&P500 clearly shows. With an opening price probably 1% or more lower, this could get ugly fast, with the previous ATR support level wiped out as last weeks bearish rising wedge pattern becomes fulfilled (good Dog below I love that pattern!):
The economic calendar is relatively quiet tonight with the latest German IFO survey, then the Dallas Fed manufacturing print, plus the usual slew of Treasury auctions.