Fed Chair Powell upset the apple cart with his testimony to Congress overnight, signalling more aggressive rate rises on the agenda. Wall Street sold off sharply while the USD rose against everything as the risk complex re-adjusted aka lost its collective mettle. European shares fell back as will Asian bourses this morning on the open. 10 year US Treasury yields pulled back below the 4% level while the commodity complex saw oil prices hit hard as Brent crude retreated from its weekly high, down below the $83USD per barrel level while gold was flummoxed by the interest rate readjustment, sold off sharply down to the $1810USD per ounce level.
Looking at share markets in Asia from yesterday’s session where mainland Chinese share markets dropped sharply going into the close after being up at the open with the Shanghai Composite down more than 1% to cross back below the 3300 point barrier while the Hang Seng followed suit, up 0.5% at one stage before slumping 0.3% to close at 20534 points. The daily chart is showing a new rollover underway as price action is still well below previous ATR support as momentum gets out of oversold territory but fails to set up a swing play:
Japanese stock markets were also on the go, but up this time extending last week’s surge with the Nikkei 225 up 0.3% to 28309 points. This big bounceback maybe squashed today although a cheaper Yen could provide a tailwind as futures indicate a slight pullback in the wake of the selling on Wall Street overnight. Daily momentum is well into the overbought zone with support clearly evident at the 27000 point area which must be defended:
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