Wall Street bounced back overnight in the absence of bad news as traders awake tonight’s US CPI print. The USD pulled back against most of the majors with Euro bouncing back above the 1.07 handle, while the Australian dollar also bounced off short term support at the 69 cent level. 10 year Treasury yields fell back only slightly as the shorter end of the curve rose while the commodity complex saw oil prices lift stabilise on the back of Russia’s cutback in production announcements with Brent crude hovering around the $86USD per barrel level. Gold is still in a depressed funk, falling even further below the $1850USD per ounce level.
Looking at share markets in Asia from yesterday’s session where mainland Chinese share markets lifted throughout the session with the Shanghai Composite up 0.7% to 3284 points while the Hang Seng was looking like continuing its recent falls, down 0.5% at one stage before recovering with only a minor loss – down 0.1% to 21164 points. The daily chart had being showing a nice breakout with daily momentum well overbought but still unable to breach the 23000 point level. Price action has now rolled over through ATR support with momentum crossing into negative territory but a possible corrective phase has not yet eventuated with support clearly evident at the 20000 point level:
Japanese stock markets were poor performers as well with the Nikkei 225 closing nearly 1% lower at 27427 points, although futures are suggesting a reclamation and then some on the open. 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 remains unable to clear the 27500 point level. Daily momentum has reverted out of overbought mode and could be suggesting a slide back below the low moving average next but support is holding quite strongly here:
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