The carnival of Chinese stock market experienced a full stop and fell over 5% after it refreshed a 4-year high. The fear spread to Western markets later along with the news of Greek political instability. The need for a safe haven surged and boosted the gold price and Yen. Dollar index once retreated to 88.10 in the US session and finally recovered half of the loss to 88.70. However, a short-term correction of Dollar is on the way.
We finally witness a large drawback on Dollar Yen after a 6-week rally. Yen once rose to the 118 mark against Dollar, recovering all loss in this month. The 14-day RSI finally fell below 70 and AO again turned red. Dollar Yen closed at around 119.50 this morning and confirmed that the correction has started.
After the over $80 intraday reverse on December 1st, the rebound of gold continues to be dramatic. Gold surged another $30 to $1232, a high since October 22nd, and once tested the $1240 resistance last night. The upper band of the half-year bearish channel has been touched. $1240 is the next critical level. If the price breaks this level, a mid-term uptrend will be confirmed.
The global stock markets were in a sea of red yesterday. The Shanghai Composite plummeted 5.43% to 2856. ASX 200 also lost 1.68% to 5283. The Nikkei Stock Average was down 0.68%. The European markets were suppressed by the risk of Greece quitting the Euro area, the UK FTSE lost 2.14%, the German DAX declined 2.21% and the French CAC Index was down 2.55%. The US market followed the weakness but reversed most loss in the afternoon session. The S&P 500 closed flat at 2060. The Dow closed 0.29% lower to 17801, and the Nasdaq Composite Index rose 0.54% to 4766.
On the data front, Australian Westpac Consumer Sentiment will be released at 10:30 AEDST and Home Loans is at one hour later. China inflation data will be at 12:30 AEDST. Reserve Bank of New Zealand will publish its statement at 7:00 am tomorrow morning.
Have a great trading day!
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