Most the action has once again been in the stock markets on Thursday, with Oil and Gold also making an appearance, and as we discussed before, the longer term charts for the US stock markets look increasingly heavy so further downside price action is favoured. The short term momentum indicators have become oversold, so and the hourlies are pointing to a minor recovery and I would not sell the S+P or the DJI at current levels but look for any rally, perhaps towards 2775/25400 to do so. The ASX is also sharply lower again and seems to have further losses ahead of it. Look to sell above 5800 with a downside target at the next major support of 5679 (4 April low). The volatility is going to continue to build, so be nimble.
In the FX markets, the US$ is weaker, with the Euro leading the way higher alongside the Aud and Kiwi which shrugged off the stock markets moves. The Euro still looks bid although the commodity currencies less certain and are possibly best left aside today, although I still prefer to sell rallies. US$Jpy does seem very heavy still although the moves have been relatively contained on Thursday. Again, look to sell rallies.
Commodities had a big day, with Gold up 2.5% and WTI down another 3%. Oil still looks as though it has further to go, while Gold, although the short term momentum indicators still look positive, the longer term charts remain in neutral, so I would not be too involved.
Finally, not that USDCNY made a bearish key day reversal and now seems to be a sell on rallies although, with the SHCOMP having closed down 5.2%, it is hard to see the CNY making any real gains.
By October 12, 2018
*Trade of the day: October 12, 2018 6:59 AM(AET)
*This is a personal opinion only, based on the look of the table below, and carries no guarantee of success.
Range Trade: EurUsd: 1.1550/1.1650
Buy EurUsd @ 1.1540. SL @ 1.1510, TP @ 1.1610
Range Trade: AudUsd: 0.7020/0.7120
Sell US$Jpy @ 112.80. SL @ 113.30, TP @ 111.80
Sell S+P @ 2770. SL @ 2805, TP @ 2680