Wall Street was somewhat volatile as the US mid term elections get underway with fears of a Congressional deadlock (let alone the end of the American experiment with democracy) looming large in the background. Bitcoin fell sharply, down over 20% to $16K before meekly recovering to the $18K level while the USD continued to lose ground against the major currency pairs, as the downtrend following the mixed NFP print sees Euro now stay above parity – but only just – while the Australian dollar finally pushed through the 65 cent level. US bond markets were relatively sanguine with 10 year Treasury yields remaining around the 4.2% level while commodities were mixed despite the lower USD with Brent crude falling back to the $95USD per barrel level while gold zoomed past its Friday high to finally clear the $1700USD per ounce level.
Looking at share markets in Asia from yesterday’s session where mainland Chinese share markets puled back after their recent sharp rebound with the Shanghai Composite closing down 0.4% at 3064 points while the Hang Seng Index has lost a similar amount, but remaining above the 16000 point level at 16557 points. The daily chart is still showing a potential bottoming action here after almost testing the 2008 lows, as the 15000 point level remains the key area to watch for signs of support. The previous session bullish engulfing candle is setting up for a clearance of overhead trailing ATR resistance so we could be seeing a continuation of a melt up rally:
Japanese stock markets are still playing catchup with the Nikkei 225 closing 1.3% higher at 27872 points. The daily price chart is showing a breakout brewing as overhead resistance at the 27500 level is cleared with a better lead from Wall Street helping as confidence starts to build. Futures are indicating another good session this morning with momentum now overbought:
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