Macro Morning

Wall Street worries were relieved somewhat on Friday night with some upside earnings surprises, but it was a weak finish to the trading week. European shares had a better finish and remain in a strong uptrend as the USD keeps Euro at bay. A packed economic calendar this week will indeed keep FX traders on their toes with USD moving back and forth against the majors with the Australian dollar pushed back below the 67 handle after a sideways trend all last week. 10 year US Treasury yields lifted slightly above the 3.5% level on continued weak domestic US data while the commodity complex rebounded slightly with Brent crude finishing up slightly after a bad week at the $81USD per barrel level. Gold was the odd one out, unable to get back above the $2000USD per ounce level with another selloff down into the low $1980s.

Looking at share markets in Asia from Friday’s session where mainland Chinese share markets again fell sharply into the red at the close, with the Shanghai Composite down over 1.9% to remain not just below the 3400 point barrier but almost crossing the 3300 point level. Meanwhile the Hang Seng followed suit, finishing over 1.5% lower at 20075 points. The daily chart was showing resistance building stronger at the 20500 point level with daily momentum unable to get into a clear overbought mode, with price action and futures indicating a rollover building here. The start of year correction may be returning due to the inability to get a substantial lift above that 20500 point level of resistance:

Japanese stock markets were the best in the region, but only relatively speaking, with the Nikkei 225 closing 0.3% lower at 28564 points. The previous bounceback looked like a bull trap, but this still may have more traction, taking out the March highs although futures are indicating a slight lift on the open. Daily momentum was getting back into overbought conditions with support building at the 27000 point area, but price action still looks quite toppy here: