Risk aversion Dominates the market today as the world awaits a new "season" in US-China trade war drama. At this point, with Trump's hard line rhetoric, it's very doubt if Chinese Vice Premier Liu He could turn around the situation in his visit to Washington today. New rounds of tariffs will very likely take effect tomorrow, and China's retaliations would soon follow. After a few months of "recess", trade-war is going to escalate to another level. In the US markets, DOW opens sharply lower and is trading down over -300pts at the time of writing. The strong break of 55 day EMA now serves as a strong warn of bearish reversal for the near term. 10-year yield is also back pressing 2.44. In the currency markets, Swiss Franc and Yen are naturally the strongest ones. Euro display much resilience as it's competing with Dollar as third strongest. Australian Dollar is the weakest one followed by Sterling and Canadian. Technically, 0.6962 in AUD/USD is an immediate focus and break will resume recent fall from 0.7295. USD/CAD, with today's rise, could be challenging 1.3521 resistance too. Break will also resume recent rise from 1.3068. USD/PY is pressing 109.71 key support. Firm break there could trigger downside acceleration. In Europe, currently, FTSE is down -0.55%. DAX is down -1.22%. CAC is down -1.58%. German 10-year yield is down -0.0195 at -0.062. Earlier in Asia, Nikkei dropped -0.93%. Hong Kong HSI dropped -2.39%. China Shanghai SSE dropped -1.48%. Singapore Strait Times dropped -0.43%. Japan 10-year JGB yield rose 0.0053 to -0.046. |
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