Wall Street returned from its long weekend with the latest ISM services PMI surprising the upside, putting more pressure on the Fed and pushing the USD to a twenty year high. European stocks pushed slightly higher, but remain highly nervous around the energy crisis, with Euro still well below parity against the USD. The Australian dollar flopped below the 68 handle despite the big 50bps rise by the RBA yesterday, as bond markets continued to sell off with 10 year Treasuries now at a three month high at the 3.3% level with the next Fed meeting expectations still at a 75bps rise. Crude oil also flopped with Brent crude down more than 3% to retreat below the $93USD per barrel level while gold rolled over to return to just above the critical $1700USD per ounce level. Meanwhile Bitcoin crashed to below the $19000 per specubuck level.
Looking at share markets in Asia from yesterday’s session, where Chinese share markets had a very positive session with the Shanghai Composite up 1.3% to 3243 points while the Hang Seng Index still can’t get out of sell mode, but managed to only fall 0.2% to 19202 points, as the 20,000 point level turns into staunch resistance. The daily chart remains quite volatile with overhead resistance and daily momentum readings still pushing a very bearish narrative here as the moving average channel turns over sharply as price action falls below the May lows:
Japanese stock markets are trying to stabilise with the Nikkei 225 closing with another scratch session, down just 0.1% at 27626 points. The daily chart is still showing a considerable dip below the trailing ATR support level at the 28000 point area which had been firm since the breakout in early August but is now turning into resistance. Daily momentum continues to dive with oversold readings and without any help from a very weak Yen. Futures continue to suggest more selloffs as the trading week continues, so watch the 27000 point level closely:
The full text of this article is available to MacroBusiness subscribers