Asian markets are dropping on Monday amid growing worries about the stability of the junk-bond market and tumbling oil prices. The declines in Asia came after the S&P fell 1.9% on Friday, the biggest daily drop since September as the price of U.S. crude oil fell below $36 a barrel. Investors were also cautious before the highly anticipated federal reserve policy meeting this Tuesday and Wednesday, when officials are widely expected to raise interest rates for the first time in almost a decade from ultralow levels. Higher rates are expected to draw investors back into the U.S. and away from riskier assets, including emerging markets and Asia.
Asian stock markets: Nikkei down 1.96 %, Shanghai Composite up 0.55 %, Hang Seng down 0.95 %, ASX 200 up 1.55 %
Commodities: Gold at $1075 (-0.03 %), Silver at $13.90 (+0.10 %), WTI Oil at $35.45 (-0.50 %), Brent Oil at $38.10 (-0.55 %)
Going ahead, investors will look forward to the Eurozone industrial production data for October, scheduled to be released in a few hours. Mario Draghi, ECB President will also speak later today.
Trading quote of the day:
Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected.
George Soros
Green lines are resistance, Red lines are support.
EUR/USD
Pivot: 1.0925
Likley scenario: long positions above 1.0925 with targets @ 1.103 & 1.1075 in extension.
Alternative scenario: below 1.0925 look for further downside with 1.088 & 1.084 as targets.
Comment: even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
GBP/USD
Pivot: 1.513
Likley scenario: long positions above 1.513 with targets @ 1.5245 & 1.531 in extension.
Alternative scenario: below 1.513 look for further downside with 1.5075 & 1.5035 as targets.
Comment: even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
AUD/USD
Pivot: 0.724
Likley scenario: short positions below 0.724 with targets @ 0.715 & 0.713 in extension.
Alternative scenario: above 0.724 look for further upside with 0.727 & 0.731 as targets.
Comment: even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.
