Originally published by Rivkin Securities
Following a sharp reversal intra-day, US equity markets closed lower on Tuesday, with the S&P 500 declining 5.99 points (-0.24%) to close at 2474.92, while the Nasdaq Composite was down 13.31 points (-0.21%) by the close. With the S&P 500 trading as high as 2490.87 during the session, only to close towards the lower end of the daily range, a significant reversal candle is now evident on the daily chart, potentially suggesting that buyers are running out of steam, putting the current up-trend at risk of ending, at least in the short-term.
ASX SPI200 futures have lifted 4 points in overnight trading to be currently at 5682. The S&P/ASX 200 continues to trade within a well-defined range between resistance in the 5800 to 5820 region and support at the 5650 level. Prices have been contained to this range for 2 months now.
Commodity markets were slightly higher overall, with the Reuters CRB Index gaining 0.08% in overnight trading. Energy was weaker, with crude oil prices declining by 0.24% to close at US$49.05 a barrel, while RBOB gasoline was down over 1% lower to close at US$1.6030 per gallon. Precious metal prices were all slightly higher, led by a 0.43% gain in silver.
In terms of economic data, today sees the release of important data out of China, specifically the Chinese PPI and CPI data. CPI is expected to come in at 1.5%, matching the prior month, with PPI is expected to have its first month on month increase since February to 5.6%.
The AUD/USD closed at 0.7911 in overnight trade, having pulled back slightly over the past 2 weeks from the 80-cent level. As can be seen on the monthly chart below, this is a significant technical level, being both major resistance and support over the past 25 years. As such, prices may well consolidate for a while below this level, before a sustained break up is achievable. Overall, with the longer-term trend for AUD/USD down, and resistance just above current levels, additional upside from here looks unlikely.
Data Releases:
- Chinese PPI & CPI 11:30pm AEST