Asian indices finished lower for the second day in a row as trade worries resurface and Hong Kong protests regarding the China extradition bill weighs on traders sentiment. The Nikkei225 finished 0.46 percent lower to 21,032; the Hang Seng benchmark in Hong Kong, finished 0.05 percent lower at 27,294. The Shanghai Composite finished 0.04 percent higher to 2,910, while in Singapore, the FTSE Straits Times index finished 0.05 percent lower to 3,207. Australian equities saw a brief spike following the release of the May jobs report but soon fell back into its old pattern. At the end of the day, the ASX200 finished 1.3 points or 0.02% lower at 6542.4.
European session started higher today despite renewed worries about trade relations between the US and China and a rise in geopolitical tensions. DAX30 is adding 0.64 percent to 12,193, CAC40 is 0.32 percent higher at 5,391 while the FTSE MIB in Milan is trading 0.84 percent higher at 20,634. The London Stock Exchange is 0.37 percent higher to 7,394 as the Brexit uncertainty continues.
In commodities markets, crude oil jumps higher at 52.3 after reports that two tankers have been attacked in the Gulf of Oman. Oil is down almost 18% from the high in late April, wiping out about half of its rally earlier this year due to increased global trade worries. Brent oil also trades higher to $61,71 per barrel as major oil producers have yet to agree on adjustments on output. Gold also trades higher to 1,337, following the recent developments in the Gulf of Oman. The precious metal broke above the 50 and 100-hour moving averages yesterday turning the short term technical picture to bullish. Gold will find support at the 1300 round figure and then at 1295, the 100-day moving average, while more bids will emerge at the 50-day moving average at 1287. On the upside, resistance stands at 1344 the high from the previous week.
In cryptocurrencies market, bitcoin (BTCUSD) managed to break above the key 8,000 mark, the daily low for BTC was at 8,048, and the daily high at 8,177. Immediate support for BTC stands now at $8,000 round figure while next support stands at 7411, the low from the recent trading range. On the upside, strong resistance now stands at 8,261, the high from yesterday while I expect extra pressure from sellers at 8,500 and then at 8,700. Ethereum (ETHUSD) adds twelve dollars to 258, with capitalization now to 27.5 billion. On the upside, the immediate resistance stands at 287, the recent high while the support stands at 200 round figure. Litecoin (LTCUSD) consolidate around yesterdays high at 136. The crypto market cap holds above $262.0B.
On the Lookout:
Australia’s unemployment rate remained steady at 5.2% in May, contradicting the market expectation of a drop to 5.1%. The Aussie economy added 42,300 jobs in May, beating both the analyst’s expectation of 17.5K and the previous month’s print of 28.4K by a big margin.
The Swiss central bank (SNB) decides on monetary policy today at 09.30.
Trading Perspective: In fx markets, USD trades lower at 96.44 on speculation over Fed rate cut, while the Aussie dollar trades lower to 0.696 as jobless rate remained steady at 5.2% in May. Kiwi also trades lower to 0.6566 level as New Zealand has cut its budget surplus forecast for 2019/20 to NZD1.3bn.
GBPUSD is trading lower today breaking below the 1.27 as the bearish momentum for Cable is still intact amid growing concerns over Brexit. The pair hit the daily low at 1.2661 and the daily high at 1.2700. Major support now stands at 1.26 recent low. On the upside, immediate resistance now stands at 1.2753, the high from yesterday. Pound shows persistent weakness amid UK political uncertainty and also on the back of global risk aversion. So any uptick can match excess offers.
In Sterling futures markets, the open interest increased by 2.2K contracts to their open interest positions on Wednesday, while volume increased by almost 81K contracts.
EURUSD started the day lower breaking below 1.13 and has trapped in 10 pips trading range. On the upside, the immediate resistance stands at 1.1340 the high from yesterday, while more offers will emerge at 1.1367, the 200-day moving average. Support stands at 1.1271, the 100-day moving average, while more bids will emerge at 1.12 round figure.
In euro futures markets, the open interest rose by more than 24K contracts on Wednesday, while volume posted the biggest up move since March 7, increasing by around 265.4K contracts.
USDJPY trades 0.07 percent lower to 108,44, today the pair hit the low at 108.15 and the high at 108.53. The pair will find support at 107.84 recent low. On the upside, immediate resistance for the pair now stands at 108.71, the high from yesterday. The USD price dynamics will continue to drive the pair’s momentum as traders focus shifts to FED next move.
In Yen futures markets, open interest shrunk by almost 3.3K contracts on Wednesday, while, volume rose for the second session in a row, this time by nearly 53.4K contracts.
USDCAD makes an attempt higher and trading as of writing at 1.3315 as the retreat in crude oil prices. Canada’s main export item seems to have added further weakness in the Canadian Dollar (CAD). The pair will find immediate support at the 200-day moving average around 1.3250 while extra support stands at 1.3200 round figure. On the upside, immediate resistance stands at the 1.33 zone before an attempt to 1.3348 where the 100-day moving average stands.