Asian Indices Mixed

Risk-On Mode In Asia, Gold Breaks Above 1600

Asian indices recovered some of yesterday’s losses as stock markets return in risk-on mode after Wall Street indices pared losses to Apple’s warning and weak earnings report from Walmart.

Investors bet on more stimulus from PBOC to help the struggling economy amid the coronavirus outbreak. New coronavirus cases in China continued to fall, with 1,749 new infections and 136 additional deaths. 

Nikkei 225 ended 0.89% lower at 23400. The Japan Exports came in at -2.6% better than expectations of -6.9% in January. Japan’s economy shrunk by 6.3% in the fourth quarter, as reported last week. That was the biggest decline in GDP since Q2 2014 and the second-biggest drop since the Financial Crisis. The Hang Seng ended 0.46% higher at 27655. The Singapore FTSE Straits Times finished 0.51% higher at 3212. The Shanghai Composite index closed down 0.32% at 2975. The ASX 200 index in Australia ended 0.43% higher at 7144. 

European stocks are trading higher. The German DAX is 0.43% higher at 13,741 close to all-time highs. CAC40 index is 0.49% higher at 6,086, while the FTSE MIB in Milan is 0.57% higher at 25,365. In London, the FTSE 100 is 0.81% higher at 7,441.  

In the commodities markets, crude oil is higher as coronavirus fears ease, and the WTI crude is 0.71% higher at $52.59. Brent oil is 0.70% higher at $58.07 per barrel. Gold price is 0.40% higher at 1,607. Gold’s outlook is bullish as Gold trades above all crucial daily moving averages. Immediate resistance will be met at $1,611, the recent high, while the support stands at $1,590, the recent low. Silver is 1.03% higher at $18.33.    

risk-on mode
BTCUSD Daily Chart

Cryptocurrencies consolidate close to yesterday’s top. Bitcoin is 0.02% higher at $10,175, hitting the daily low at $10,010 and the daily high at $10,230. Bitcoin momentum is positive, as bitcoin is trading above all significant daily moving averages. Support for BTCUSD stands now at $9,467, while the next major support stands at 9,000. On the upside, resistance stands at 10,495 yearly top and then at 10,800 round mark. Ethereum trades 0.15% higher at 282.39, with capitalization at 30.90 billion.

On the upside, immediate resistance for ETHUSD stands at $274.18 recent high while the support stands at $213.47, the February low. XRPUSD is 1.11% lower at 0.2950. Litecoin (LTCUSD) is 0.27% higher at 72.51. The crypto market capitalization is now at $295.95 billion.

In the Lookout: Japan Machinery Orders (YoY) came in at -3.5% below forecasts of -1.3% in December. The Japan Imports came in at -3.6%, below the expectations of -1.3%. 

Australia Wage Price Index (YoY) came in at 2.2% in line with forecasts for the fourth quarter. 

Moody yesterday cut China’s growth forecast to 5.2% for 2020 from 5.8%. Yesterday, Moody’s also cut India’s 2020 GDP forecast to 5.4% vs. 6.6% previous. 

The People’s Bank of China (PBOC) set the Yuan reference rate at 7.0012 versus the previous settlement at 6.9825. 

Trading Perspective: In the foreign exchange (fx) market, the US dollar index is 0.03% lower at 99.42. The AUDUSD is 0.29 higher at 0.6704. NZDUSD trades 0.35% higher at 0.6407, and the USDCHF pair is 0.05% higher at 0.9835.

risk-on mode
NZDUSD Daily Chart

GBPUSD trades 0.13% lower at 1.2978. The initial support for the GBP against the USD now stands at 1.28 low, which if broken, might push the GBPUSD pair down towards 1.20. On the upside, initial resistance for GBPUSD stands at 1.32 and then at 1.3511 recent high.

EURUSD trades 0.13% higher at 1.0805 as the pair’s momentum is bearish. The EURUSD pair breached below the 100-day moving average, and now sellers are in control. Immediate resistance for the EURUSD pair will be met at 1.1224, the yearly high. On the other hand, the first support is at 1.0790 today’s low and then at 1.0750.

USDJPY is trading 0.33% higher at 110.23, having hit the daily low at 109.84 and the daily high at 110.23. The USDJPY will meet first support at 105.43 the August low. On the upside, resistance for the USDJPY now stands at 110.27 January high.

USDCAD is 0.22% lower at 1.3230. The USDCAD will meet first support at 1.2950 the recent low while the next major support level stands at 1.29 round figure. On the other side, resistance will be met at 1.3300.