Too many headlines and things going on in the global markets so here are the headlines and their implications for the meltdown of the USD and stock indices yesterday and overnight in Asia:
• Greek PM Tsipras resigns, paving the way for Greek snap elections.
• China August manufacturing activity drops to 6.5 year low causing demand for Safe haven assets such as GOLD which surged to $1168 from $1113 two days ago.
• Stocks and oil slump as fears of a China-led deceleration in global growth gripped markets. DAX dropped to lowest point since January. US stocks are also at lowest point since 6 months with Dow Jones falling over 350 points
• North Korea troops on war alert, causing demand for safe haven (JPY and Gold)
A very volatile Asian session, with stocks extending selloff while gold and safe haven JPY surged to new highs. AUDUSD came also under renewed pressure due to the Chinese manufacturing data. Going into the EU session, we expect the EU PMI numbers to be released but the impact will likely be limited and focus should remain on price action and technical levels.
Trading Quote of the Day: “Bull markets are born on pessimism, grown on skepticism, mature on optimism, and die on euphoria” John Templeton
USDCAD
Pivot: 1.313
Likely scenarios: Short positions below 1.313 with targets @ 1.3055 & 1.302 in extension.
Alternative scenario: Above 1.313 look for further upside with 1.3175 & 1.3215 as targets.
Comment: As long as 1.313 is resistance, look for choppy price action with a bearish bias.
USDCHF
Pivot: 0.963
Likely scenarios: Short positions below 0.963 with targets @ 0.954 & 0.951 in extension.
Alternative scenario: Above 0.963 look for further upside with 0.967 & 0.9725 as targets.
Comment: A break below 0.954 would trigger a drop towards 0.951.
OIL
Pivot: 41.8
Likely scenarios: Short positions below 41.8 with targets @ 40.4 & 39.95 in extension.
Alternative scenario: Above 41.8 look for further upside with 42.6 & 43.2 as targets.
Comment: As long as 41.8 is resistance, likely decline to 40.4.
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