Lower US wage data has pushed Wall Street higher overnight, papering over the disappointing earnings season with the USD losing its recent ground with the major currency pairs. Euro came back to just under the 1.09 handle while the Australian dollar briefly fell below the 70 cent level before bouncing back. US bond markets saw another small selloff with 10 year Treasury yields stabilising around the 3.5% level while the commodity complex saw oil prices also bounce a little higher on the weaker USD, with Brent crude finishing just above the $85USD per barrel level. Gold almost snapped below the $1900 level before coming back to finish just below the $1930USD per ounce level in a volatile session.
Looking at share markets in Asia from yesterday’s session where Chinese share markets are playing catchup with the negative mood with the Shanghai Composite down nearly 0.5% to 3254 points while the Hang Seng has continued its slump to fall over 1% and cross below the 22000 point level. The daily chart had shown a clear breakout after building up a series of steps with daily momentum well overbought and ready for new highs but the 23000 point level maybe too far to reach as profit takers step in. I’m watching for a potential rollover through ATR support next:
Japanese stock markets are slipping again, with the Nikkei 225 closing 0.4% lower at 27327 points. After bottoming out at the 25000 point level the recent positive correlation performance with Wall Street was helping lift price action back to the November highs, but not yet above as resistance builds. Clearing daily ATR resistance and getting daily momentum back into overbought mode should set up a further move higher to the 28000 point level next, but price action is cooling down here:
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