Wall Street stumbled slightly overnight on the latest US industrial production numbers while European markets continued to rally. The USD remained strong but unchanged overnight as the Euro halted its recent crash with the Australian dollar stabilising just above the 70 cent level. Bond markets saw roundtripping of yields with 10 year Treasuries eventually finishing at the 2.8% level while interest rate futures also still showing 120bps in rate rises factored in by the end of 2022. Commodity prices had the biggest moves due to the stronger USD with Brent crude oil down over 1.5% to below $93USD per barrel while gold remains unable to get back above the $1800USD per ounce level.
Looking at share markets in Asia from yesterday’s session, where mainland Chinese share markets were oscillating across the session with the Shanghai Composite lifting slightly into the close to finish at 3277 points while the Hang Seng Index retraced again, closing more than 1% down to 19830 points. The daily chart is still showing considerable overhead resistance and daily momentum readings remaining quite negative as the moving average channel keeps trending downwards. The May lows could come under pressure soon if there is another break below the low moving average:
Japanese stock markets are dead flat after last week’s surge, with the Nikkei 225 flat at 28872 points. The daily chart clearly shows a nice breakout here after finally clearing resistance at the previous highs at 28000 points with daily momentum remaining well overbought. The overall monthly/weekly downtrend (sloping black line above) seems to be broken here after price action bunched up for so long so with very positive risk sentiment now, watch the 28000 point level to turn into support next:
